EMERGING MARKETS-Rupiah, baht resume decline; Thai stocks cheer stimulus

  • Reuters
  • Stock Market News
EMERGING MARKETS-Rupiah, baht resume decline; Thai stocks cheer stimulus

* Graphic: World FX rates http://tmsnrt.rs/2egbfVh

* Graphic: Foreign flows into Asian stocks https://tmsnrt.rs/3f2vwbA

* Baht hits one-week low

* Rupiah lower for third straight day

* Malaysia stocks lose almost 1%

By Shashwat Awasthi

Sept 3 (Reuters) - Indonesia's rupiah eased on Thursday as doubts about the fiscal and monetary policy mix and the central bank's independence weighed on sentiment, while additional fiscal stimulus in Thailand supported Bangkok stocks for a second day.

A bounce in the U.S. dollar kept gains among other emerging Asian currencies in check, with many trading flat to marginally higher on the day.

Thailand's baht THB=TH , hit by the sudden resignation of the finance minister this week, weakened for the second straight day and fell 0.3%. Indonesian rupiah IDR= gave up another 0.4%, taking weekly losses in South East Asia's most laggard currency this year to more than 1%, even after Bank Indonesia's (BI) intervention to stabilize the currency on Wednesday.

Proposals earlier this week for a new monetary policy framework that would shake up Bank Indonesia's decision making and potentially give ministers a say on interest rates have shaken investors at a time when the central bank is already aiding government fiscal stimulus efforts to back-stop an emergency bond issuance scheme. economy has been among the hardest hit by the coronavirus crisis this year.

"We could see modest bouts of associated IDR softening on further developments in the near term," Maybank analysts said in a note.

"One key area markets would be scrutinizing is the confluence between ceding of central bank independence and the potential for larger extent of debt monetization by BI."

The country's main stock index .JKSE slipped 0.7%, and analysts at OCBC Bank cited confusion about whether debt monetization was a one-off or not as a possible hindrance.

Stocks in Thailand .SETI added 0.5% and have climbed more than 1% in the last two days as $2.2 billion in cash handouts and job measures announced Wednesday boosted risk taking. on Thursday also showed core inflation in August rose in line with analysts' estimates. Korean shares .KS11 jumped almost 1.5% amid a rally in Asian equities after a sustained recovery in China's services sector and the prospect of additional U.S. stimulus to support the economy. MKTS/GLOB

Malaysia's main index .KLSE slid 0.9%, however, giving up almost all the gains it had recorded in the previous session.

HIGHLIGHTS

** Indonesian 10-year benchmark yields are up 4.5 basis points at 6.953%

** Top losers on the Jakarta stock index .JKSE include Megapolitan Developments EMDE.JK down 7%, Alfa Energi Investama FIRE.JK down 6.85% and Sunson Textile Manufacturer SSTM.JK down 6.8%

** Top losers on FTSE Bursa Malaysia Kl Index .KLSE include Hartalega Holdings HTHB.KL down 5.21%, Tenaga Nasional TENA.KL down 1.78% and Maxis MXSC.KL down 1.76%

Asia stock indexes and currencies at 0419 GMT

COUNTRY

FX RIC

FX DAILY %

FX YTD %

INDEX STOCKS DAILY % STOCKS YTD %

Japan

JPY=

-0.09

+2.19

.N225

1.28

-0.47

China

CNY=CFXS

+0.05

+1.89

.SSEC

-0.06

11.56

India

INR=IN

+0.00

-2.25

.NSEI

0.13

-5.09 Indonesia

IDR=

-0.20

-6.03

.JKSE

-0.59

-16.18 Malaysia

MYR=

+0.05

-1.26

.KLSE

-0.86

-4.05 Philippines

PHP=

+0.03

+4.35

.PSI

0.12

-26.49

S.Korea

KRW=KFTC

-0.12

-2.56

.KS11

1.45

9.14 Singapore

SGD=

-0.01

-1.34

.STI

-0.63

-21.68

Taiwan

TWD=TP

+0.63

+2.60

.TWII

0.54

6.43 Thailand

THB=TH

-0.29

-4.47

.SETI

0.46

-16.32

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