1. Most Southeast Asian stocks rise tracking Wall Street, Singapore slips; US Federal policy eyed

Most Southeast Asian stocks rise tracking Wall Street, Singapore slips; US Federal policy eyed

Most Southeast Asian stock markets rose on Wednesday, drawing heart from record gains on Wall Street in the previous session, while investors awaited clarity on the Federal Reserve's future path for US policy after a likely rate hike later in the day.

By: | Published: June 14, 2017 11:16 AM
The Fed may also provide more clues on how it plans to reduce its holdings of more than trillion in Treasuries and mortgage-backed securities.

Most Southeast Asian stock markets rose on Wednesday, drawing heart from record gains on Wall Street in the previous session, while investors awaited clarity on the Federal Reserve’s future path for US policy after a likely rate hike later in the day. Economists polled by Reuters overwhelmingly see the Fed raising its benchmark rate to a target range of 1.00 percent to 1.25 percent, though expectations for further rate hikes are fading. The Fed is scheduled to announce its monetary policy decision at 1800 GMT later in the day at the end of a two-day policy meeting, followed by a press conference by Chair Janet Yellen.

The Fed may also provide more clues on how it plans to reduce its holdings of more than $4 trillion in Treasuries and mortgage-backed securities. “There’s some spillover from last night’s performance of the U.S. stock markets,” said Mikey Macanaig, an analyst with Sunsecurities Inc, adding that he expected the Fed would not raise rates anymore this quarter after the June hike in the light of recent weak economic data. “However, we are still very cautious; we don’t want any surprises,” he said.

Meanwhile, data out of China showed retail sales and industrial output topped forecasts in May, but a miss in urban investment reinforced views the world’s second-largest economy will soon start to lose some momentum as lending costs rise and the property market cools. Analysts dismissed the Chinese data as having little effect on the direction of the Southeast Asian stock markets.

Indonesian shares rose as much as half a percent, outperforming other markets in the region, on the back of gains in financials and basic materials. Bank Rakyat Indonesia (Persero) Tbk PT and Bank Mandiri (Persero) Tbk PT were up 0.7 percent and 1.6 percent, respectively. Malaysian shares were up 0.3 percent, buoyed by gains in consumer-driven stocks and telcos. Entertainment firm Astro Malaysia Holdings and lender CIMB Group were the biggest gainers. Singapore and Philippine shares dropped 0.2 percent each.

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