Southeast Asian stock markets were tepid on Friday as investors shied away from taking any big bets amid concerns that political turmoil in the United States could delay efforts by President Donald Trump to implement his economic stimulus plans. Trump, striking a defiant tone on Thursday after days of political tumult, denied asking former FBI Director James Comey to drop a probe into his former national security adviser and decried a “witch hunt” against him.
Comey’s dismissal last week set off a series of jarring developments that culminated on Wednesday in the Justice Department’s appointment of a special counsel to probe possible ties between Russia and Trump’s 2016 presidential campaign.
“There are a lot of uncertainties in the emerging markets arising from external issues, including the one related to the U.S. president, and I think investors are taking a wait-and-see approach in terms of making any further commitments,” said Taye Shim, head of research at Jakarta-based Mirae Asset Sekuritas.
“Other than that, the fundamental growth recovery still remains intact and we believe that emerging markets will still be the key beneficiary in this recovery cycle.” Trading was relatively soft in Southeast Asia. MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.2 percent at one point.
Philippine shares were little changed on Friday with industrial and telecom stocks among the major losers. JG Summit Holdings fell 1.5 percent. The Philippine stock index was headed for a second straight weekly fall. Singapore shares were almost flat, but headed for their first weekly drop in four. Jakarta was up 0.3 percent, but poised for its third straight weekly decline.
Malaysian stocks were slightly higher, helped by data showing the economy grew at a better-than-expected 5.6 percent in the first quarter from a year earlier. Vietnam hit a more than one-month high, supported by energy stocks, and was on track to post its fourth straight weekly gain.
Vietnam National Petroleum Group climbed 4.9 percent and Petrovietnam Gas Joint Stock gained 1.3 percent, as oil futures rose on growing optimism that big producing countries will extend output cuts to curb a persistent glut in crude. Thai shares edged up, aided by energy stocks. Thai Oil PCL rose 1.7 percent.