EM assets rally, dollar momentum cools on Bessent pick
.
S.Korean won adds 0.7%
Indonesia stocks gain 1.7%
Singapore assets upbeat ahead of inflation print
By Shivangi Lahiri
Nov 25 (Reuters) -Assets in Asia rallied and the dollar lost steam on Monday after Donald Trump picked hedge-fund manager Scott Bessent to run the U.S. Treasury while Jakarta assets rose ahead of a dollar-denominated Islamic bonds settlement.
The South Korean won KRW=KFTC and Taiwan dollar TWD=TP gained 0.7% and 0.4% against a declining greenback while equity markets in Seoul .KS11 and Taipei .TWII both added 1.4% and 0.6%, notching two-week highs.
The U.S. dollar had its longest stretch of weekly gains in over a year on Friday as investors continued to price in President-Elect Trump's fiscal policies.
Currency markets in Southeast Asia jumped as well, with the Malaysian ringgit MYR= and Singapore dollar SGD= rising 0.3% and the Philippine peso PHP= gaining 0.1%.
Bessent is expected by market participants to push a more phased implementation of trade tariffs and make efforts to rein in the U.S. budget deficit.
"Scott Bessent is seen as someone who is very understanding of financial markets and hopefully someone who will be able to prevent more extremes of Trump's economic policies being implemented," said Khoon Goh, head of Asia research at ANZ.
"The positive effect is generally pushing Asian markets higher".
Indonesia will settle on Monday the raising of $2.75 billion through U.S. dollar-denominated Islamic bonds, also called global sukuk, with tenures of 5.5 years, 10 years and 30 years, the largest sale in a year.
"The issuance of global sukuk, which is being settled today, should provide support to the rupiah and provide more liquidity to the U.S. dollar, as the government is going to receive fresh dollars from offshore investors," said Fakhrul Fulvian, an economist at Trimegah Securities.
The rupiah IDR= gained 0.2% against the U.S. dollar while equity markets in Southeast Asia's largest economy rallied 1.6%.
Markets in Singapore were steady ahead of the release of inflation data for October, and chances of a sticky inflation print could slow down policy easing from the Monetary Authority of Singapore (MAS). Equities in the city-state rose 0.3%.
Investors are also awaiting the Bank of Korea's rate decision due later in the week.
Shares in Thailand .SETI, the Philippines .PSI and Malaysia .KLSE added 0.3%, 0.8% and 1.1%, respectively.
In other news, Adani dollar bond prices fell to almost one-year lows on Monday as investors cut their exposure to the Indian conglomerate in the wake of bribery and fraud allegations from U.S. authorities.
HIGHLIGHTS:
** China c.bank injects $124 bln into banking system via one-year policy loans
** Singapore revises Q3 GDP higher, upgrades 2024 outlook
Asian currencies and stocks as at 0334 GMT | ||||||
COUNTRY | FX RIC | FX DAILY % | FX YTD % | INDEX | STOCKS DAILY % | STOCKS YTD % |
Japan | JPY= | +0.62 | -8.28 | .N225 | 1.53 | 16.76 |
China | CNY=CFXS | +0.06 | -2.01 | .SSEC | 0.06 | 9.89 |
India | INR=IN | +0.09 | -1.37 | .NSEI | 0.00 | 10.01 |
Indonesia | IDR= | +0.16 | -2.84 | .JKSE | 1.57 | 0.49 |
Malaysia | MYR= | +0.29 | +3.10 | .KLSE | 1.09 | 10.48 |
Philippines | PHP= | +0.05 | -6.01 | .PSI | 0.83 | 5.99 |
S.Korea | KRW=KFTC | +0.68 | -7.80 | .KS11 | 1.44 | -4.44 |
Singapore | SGD= | +0.25 | -1.76 | .STI | 0.25 | 15.90 |
Taiwan | TWD=TP | +0.44 | -5.29 | .TWII | 0.64 | 28.55 |
Thailand | THB=TH | -0.10 | -1.11 | .SETI | 0.33 | 2.48 |
Graphic: World FX rates https://tmsnrt.rs/2RBWI5E
Asian stock markets https://tmsnrt.rs/2zpUAr4
Reporting by Shivangi Lahiri in Bengaluru
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