South Korean won, shares charge ahead
Most Asian currencies higher
Investors focus on US non-farm payrolls
By Archishma Iyer
Feb 2 (Reuters) –Most Asian currencies and stocks rose on Friday, with the South Korean won and equities leading the way, after risk sentiment got a boost overnight from upbeat earnings reports on Wall Street, although investors were focused on a monthly U.S. jobs report due later in the day.
The MSCI International Emerging Market Index .MIEM00000CUS rose about 0.2% to its highest since mid-January, while the dollar index was steady at 103.01 at 0355 GMT.
The markets see Friday’s U.S. non-farm payrolls data as potentially spurring the Federal Reserve to accelerate its rate cut timeline if the numbers come in below forecasts.
Market participants expect the Fed’s first rate cut in May, while the odds of a March cut have fallen to 38% from more than 70% a month ago.
Shares in Seoul .KS11 were on track to mark their best day since mid-November and the won KRW=KFTC rose as much as 0.5% against the dollar after data showed South Korea’s inflation slowed to a six-month low, even as policymakers warned that geopolitical tensions could add to price pressures.
“Faster disinflation would increase the Bank of Korea’s confidence in achieving price stability in coming months, in our view. Thus, we reiterate our view that the BOK will start rate cuts in July,” Nomura analysts said in a note.
Inflation prints from China, Thailand, the Philippines and Taiwan over the next week will also set the tone for their respective monetary policies, with price pressures already seen to be slowing in Indonesia.
“While the market is likely to push the base case for the first Fed cut from March to May in the aftermath of the January FOMC, this is unlikely to derail any of the emerging markets easing cycles,” analysts from Citi said in a client note.
Central bank decisions in Thailand and India are expected to keep rates steady in the coming days.
The Philippine peso PHP= and the Taiwan dollar TWD=TP advanced about 0.3% to 0.4%, although Thailand’s baht THB=TH slipped about 0.1%.
In Indonesia,which holds presidential and legislative elections on Feb. 14, President Joko Widodo said his cabinet was working normally, amid reports of discontent among his ministers. The rupiah IDR= rose 0.5% while Jakarta stocks .JKSE ticked lower.
Among Asian equities, Singapore .STI, Manila .PSI, Taipei .TWII and Bangkok .SETI rose, with gains ranging from 0.3% to 1.6%.
HIGHLIGHTS:
** Indonesia’s benchmark 10-year bond yield steady at 6.545%
** Singapore’s DBS to merge capital markets, brokerage with treasury markets
** INSIGHT-Ahead of election, Pakistan seals plan to sell national airline
|
Asia stock indexes and currencies at 0355 GMT |
||||||
|
COUNTRY |
FX RIC |
FX DAILY % |
FX YTD % |
INDEX |
STOCKS DAILY % |
STOCKS YTD % |
|
Japan |
JPY= |
+0.03 |
-3.63 |
.N225 |
0.8 |
8.36 |
|
China |
CNY=CFXS |
+0.01 |
-1.14 |
.SSEC |
-0.72 |
-7.54 |
|
India |
INR=IN |
+0.14 |
+0.43 |
.NSEI |
0.53 |
0.37 |
|
Indonesia |
IDR= |
+0.54 |
-1.79 |
.JKSE |
-0.29 |
-1.26 |
|
Malaysia |
MYR= |
+0.00 |
-2.90 |
.KLSE |
0.43 |
4.45 |
|
Philippines |
PHP= |
+0.30 |
-0.92 |
.PSI |
1.62 |
4.34 |
|
S.Korea |
KRW=KFTC |
+0.41 |
-2.90 |
.KS11 |
2.09 |
-2.25 |
|
Singapore |
SGD= |
+0.07 |
-1.21 |
.STI |
1.16 |
-1.88 |
|
Taiwan |
TWD=TP |
+0.43 |
-1.51 |
.TWII |
0.37 |
0.57 |
|
Thailand |
THB=TH |
-0.11 |
-3.35 |
.SETI |
1.10 |
-2.32 |
Reporting by Archishma Iyer in Bengaluru; Editing by Edmund Klamann
