SE Asia Stocks-Cautious as risk appetite seen recovering after Brexit shock
By Krishna V Kurup July 1 (Reuters) - Most Southeast Asian stocks were cautious on Friday as the Bank of England raised more hopes of monetary easing that is expected to further improve risk appetite which had slumped following Britain's shock exit from the European Union last week. Gains on Wall Street overnight were propelled in part after BOE Governor Mark Carney said the central bank would probably need to pump more stimulus into Britain's economy over the summer in wake of the Brexit shock. The impact on the United States of Britain's vote to leave the European Union was "statistically in the neighbourhood of zero" although there was uncertainty around the outcome, said St. Louis Federal Reserve Bank President James Bullard on Thursday, sticking to his view of a single increase to interest rates by the U.S. central bank this year. Central banks in Southeast Asia are also on wait and watch mode after the Brexit vote, with Indonesia's central bank saying earlier this week that it has room to loosen monetary policy again as inflation is within its range. Malaysia's central bank said on Thursday that markets have been resilient after the Brexit referendum as key domestic markets continue to have ample liquidity, adding that it would monitor developments to address further volatility. A combination of greater policy easing and lower DM (developed markets) growth expectations is favourable for ASEAN countries, said Nomura in a note. In a post-Brexit environment with greater policy accommodation, ASEAN should continue to outperform, it said. "...effects of the Brexit have mostly waned in the Asian markets," said Grace Aller, an analyst with AP Securities in Manila. The Philippine index rose nearly 1 percent as sentiment was boosted after the inauguration of Rodrigo Duterte as president on Thursday. Financial and consumer cyclical stocks led the gainers, with BDO Unibank Inc rising 2.2 percent and SM Investments Corp gaining 3.3 percent. The index hit a more than 14-month high on Thursday and gained 7.4 percent in the April-June quarter. "Investors are bullish about Duterte's incoming administration as he had a lot of changes in mind, and anticipate that he will be able to fast-track all of his plans," Aller said. Indonesian shares fell 0.6 percent, with the index touching its highest since June 2015 in early trade. Kalbe Farma Tbk PT was down nearly 2 percent. "We expect JCI to trend lower today from profit-taking, however downside is limited as reinforced investor confidence post the approval of tax amnesty should keep fund flows positive," said Taye Shim, an analyst with Jakarta-based Daewoo Securities. The Jakarta Composite Index gained 3.5 percent in the April-June quarter. Malaysian shares fell marginally, with consumer cyclicals dragging the index down. Genting Bhd lost 1.6 percent. The Thai market was closed on Friday for the mid-year closing day. For Asian Companies click; SOUTHEAST ASIAN STOCK MARKETS STOCK MARKETS Change at 0437 GMT Market Current Prev close Pct Move Singapore 2840.49 2840.93 -0.02 Bangkok 1444.99 1442.66 0.16 Manila 7873.26 7796.25 0.99 Jakarta 4988.332 5016.647 -0.56 Kuala Lumpur 1649.16 1654.08 -0.30 Ho Chi Minh 638.37 632.26 0.97 Change on year Market Current End 2015 Pct Move Singapore 2840.49 2882.73 -1.47 Bangkok 1444.99 1288.02 12.19 Manila 7873.26 6952.08 13.25 Jakarta 4988.332 4593.008 8.61 Kuala Lumpur 1649.16 1692.51 -2.56 Ho Chi Minh 638.37 579.03 10.25 (Reporting by Krishna V Kurup in Bengaluru; Editing by Biju Dwarakanath)
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