Taiwan dollar falls to 8-year low as chip stocks sold
Taiwanese dollar at lowest since May 2016
Equities in Taiwan, South Korea slump
Rupiah at lowest level in more than a week
Philippine stocks at over three-month high
By Shivangi Lahiri
July 19 (Reuters) -Taiwan shares headed for their heaviest weekly drop in three months and the island's currency slumped to an eight-year low on Friday as investors dumped chipmakers and worried about an isolationist turn in U.S. policy should Donald Trump win the presidency.
Washington is considering tougher curbs for exports of advanced semiconductor technology to China, according to a report this week.
As investors cashed out of Asia's most valuable listed company, Taiwan Semiconductor Manufacturing Co 2330.TW, and other local chip stocks, Taiwan's dollar TWD=TP slipped to its weakest level since May 2016 of 32.786 per dollar and was last down about 0.5% at 32.762.
A resilient dollar and heightened expectations that Trump could become the next U.S. president were also at play.
"The U.S. election continues to be one of the main factors for volatility as protectionist policies ... advocating broad tariff increases may pose geopolitical risks, as well as risks to global trade," Jeff Ng, head of Asia macro strategy at SMBC said.
"Trade-vulnerable currencies may be impacted by this, like the Taiwanese dollar," he said, adding that concerns around the country's export growth outlook could also be a potential factor.
The dollar index =USD was last trading at 104.27 against a basket of major currencies, and was poised to snap a two-week losing streak.
As chip stocks tumbled, equities in Taiwan .TWII declined more than 2% to their lowest level in two weeks and were poised to lose more than 4% this week.
Equities in South Korea .KS11, home to chipmaking giants SK Hynix 000660.KS and Samsung Electronics 005930.KS, fell 1.7% to mark their worst session since late May.
In Indonesia, the rupiah IDR= slipped 0.4% to 16,220 per dollar - its lowest level in more than a week and not far from a four-year low - despite the central bank intervening in the market on Thursday. It has lost 5% so far this year.
"Over the next three months (there's) likely to be a little bit of uncertainty in terms of the rupiah and BI (Bank Indonesia) will continue to be in the market," said Michael Wan, senior currency analyst at MUFG.
Indonesia is unique in that its central bank targets currency stability as part of its mandate and it has stood in the market over recent months to defend the rupiah against a stubbornly strong U.S. dollar.
Indonesian stocks .JKSE fell as much as 0.4%.
In other regional markets, Singapore stocks .STI slipped 0.9% with banks leading declines, but the Philippine benchmark .PSI rose 1.2%, touching its highest level since early April.
In China, the Shanghai SE Composite index .SSEC and the yuan CNY=CFXS were largely flat after Beijing's Third Plenum failed to provide any concrete stimulus measures.
HIGHLIGHTS:
** China pledges to expand tax sources for local govts, party official says
** Japan cuts growth forecast, prime minister warns of weak-yen pain
** Singapore central bank to issue monetary policy statement on July 26
Asian stock indexes and currencies at 0435 GMT | ||||||
COUNTRY | FX RIC | FX DAILY % | FX YTD % | INDEX | STOCKS DAILY % | STOCKS YTD % |
Japan | JPY= | -0.04 | -10.40 | .N225 | -0.40 | 19.5 |
China | CNY=CFXS | -0.07 | -2.33 | .SSEC | -0.08 | -0.01 |
India | INR=IN | +0.02 | -0.51 | .NSEI | -0.32 | 13.76 |
Indonesia | IDR= | -0.25 | -4.91 | .JKSE | -0.69 | -0.03 |
Malaysia | MYR= | -0.19 | -1.80 | .KLSE | 0.20 | 12.54 |
Philippines | PHP= | -0.05 | -5.04 | .PSI | 1.37 | 5.38 |
S.Korea | KRW=KFTC | -0.27 | -7.15 | .KS11 | -1.44 | 4.84 |
Singapore | SGD= | -0.01 | -1.85 | .STI | -0.81 | 6.26 |
Taiwan | TWD=TP | -0.48 | -6.19 | .TWII | -1.66 | 28.33 |
Thailand | THB=TH | -0.32 | -5.69 | .SETI | -0.30 | -6.71 |
Graphic: World FX rates https://tmsnrt.rs/2RBWI5E
Asian stock markets https://tmsnrt.rs/2zpUAr4
Reporting by Shivangi Lahiri in Bengaluru; additional reporting by Sameer Manekar in Bengaluru and Ankur Banerjee in Singapore; Editing by Tom Westbrook and Edwina Gibbs
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