Asian equities fall as Trump tariff threats looms; currencies nurse losses
Thai stocks fall to lowest in over 2 months
Trade war fears rattle markets
Mexican peso hovers near July 2022 lows
Markets in Indonesia closed
By Adwitiya Srivastava
Nov 27 (Reuters) -Asian equities slipped while currencies nursed losses from the prior session on Wednesday as investors grapple with U.S. President-elect Donald Trump's pledge to impose additional tariffs on top trading partners including China.
The Mexican peso MXN= continued its downtrend in the Asian trading hours, hovering near its lowest level since July 2022 scaled on Tuesday. The unit remains under intense pressure following Trump's vow to impose a 25% tariff on imports from Canada and Mexico.
"Trump's unconventional approach towards trade and his threat to impose tariffs has certainly injected volatility into markets, buoying the USD as well as weighing on the RMB, MXN, CAD, and Asian equities," Wei Liang Chang, currency and credit strategist at DBS, said.
Stocks in Bangkok .SETI fell as much as 0.9% to their lowest level since Sept. 16. Oil and gas explorers PTT Pcl PTT.BK and PTT Exploration and Production PTTEP.BK were down around 0.8% and 1.2%, respectively.
Poon Panichpibool, a markets strategist at Krung Thai Bank, said stocks in some specific markets, for instance the Thai market which is energy heavy, might be down due to the drop in oil prices after the Israel and Hezbollah ceasefire deal announcement.
Oil prices were steady in the Asian trading hours as markets assessed the potential impact of a ceasefire deal between Israel and Hezbollah and ahead of a meeting of the oil producing group. Both the crude benchmarks LCOc1, CLc1 settled lower on Tuesday. O/R
Shares in Manila .PSI shed 0.9% and those in Taiwan .TWII lost 1.3%. While, Malaysian stocks .KLSE bucked the trend, gaining 0.3% on the back of utilities and banks.
Among currencies, the Philippine peso PHP= inched up, while the South Korean won KRW=KFTC inched lower.
China's yuan CNY=CFXS eased, hovering near a four-month-low, on declining industrial profits and potential impact of tariffs.
The dollar index =USD, which measures the greenback against a basket of major currencies, was subdued during Asian trading hours.
Panichpibool said that could be due to the strength in the Japanese yen JPY= which has appreciated recently as geopolitical uncertainty sparks a rush into the safe haven currency.
The yen had added around 0.5% on Wednesday to hit a near three-week high.
Markets now await key inflation figure out of the U.S. later in the day.
Indonesian markets were closed on account of a public holiday. The rupiah IDR= was last trading a whisker away from its three-month low against the dollar, and is close to breaking 16,000 apiece threshold.
HIGHLIGHTS:
** S.Korea pension fund recently selling dollars in forex market, sources say
** China state media warn Trump against mutually destructive tariff war
** Thai Airways seeks to raise up to $1.27 bln to exit restructuring plan
** IMF sees Thai GDP growth at 2.7% this year, 2.9% next year
Asian stocks and currencies as at 0521 GMT | ||||||
COUNTRY | FX RIC | FX DAILY % | FX YTD % | INDEX | STOCKS DAILY % | STOCKS YTD % |
Japan | JPY= | +0.54 | -7.37 | .N225 | #VALUE! | #VALUE! |
China | CNY=CFXS | -0.09 | -2.20 | .SSEC | 0.62 | 10.26 |
India | INR=IN | -0.14 | -1.46 | .NSEI | -0.04 | 11.29 |
Indonesia | IDR= | +0.00 | - | .JKSE | - | -0.37 |
Malaysia | MYR= | +0.22 | +3.26 | .KLSE | 0.32 | 10.56 |
Philippines | PHP= | +0.05 | -5.95 | .PSI | -0.91 | 4.57 |
S.Korea | KRW=KFTC | -0.10 | -7.84 | .KS11 | -0.68 | -5.73 |
Singapore | SGD= | -0.03 | -2.06 | .STI | -0.22 | 14.32 |
Taiwan | TWD=TP | +0.00 | -5.46 | .TWII | -1.29 | 24.84 |
Thailand | THB=TH | +0.13 | -1.49 | .SETI | -0.71 | 0.86 |
Reporting by Adwitiya Srivastava in Bengaluru; Editing by Kim Coghill
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