MOST Southeast Asian stock markets recovered on Friday, after sinking in early trade, on hopes that moves by policymakers at home and abroad would prevent the global economy from plunging into a recession.
Still, regional markets suffered their worst week in more than a decade, pulled down by heavy losses earlier in the week due to crashing oil prices and panic over the coronavirus.
On Friday, Thai and Philippine stocks fell as much as 13.1% and 11.1%, respectively. However, both the indexes swung into positive territory as Manila ordered state pension funds to boost daily investments and Bangkok said it will hold talks to set up an over US$941 mil (RM4.026 bil) fund to support the market.
Hopes for a US stimulus package and the US Federal Reserve’s move to offer US$1.5 tril in short-term loans also helped markets find a floor.
“With central banks showering the market with liquidity again today, the thought here is that at some point, the aggressive policy measure to counteract this expected economic downturn will eventually cause the market to rally,” said Stephen Innes, chief market strategist at AxiCorp.
However, Malaysian stocks shed 5.3% and were the top losers in the region after data showed the country’s factory output slowed for a second straight month in January.
The index lost 9.3% over the week, the most since mid-2001.
Singapore shares fell 1.7%, having fallen up to 6.3%. The index logged its worst week since the financial crisis in 2008.
Among gainers, the Philippine bourse staged a sharp comeback to end 1% higher.
Given recent losses, there was some bargain-hunting at play, with the stimulus announcements helping sentiment, said Rachelle Cruz, analyst at AP Securities.
In tourism-dependent Thailand, stocks rebounded to end 1.3% higher, after a plunge earlier triggered a circuit breaker. The benchmark lost nearly 18% this week, the most since 2008.
A drop of over 5% in Indonesian shares had also triggered a circuit breaker. However, the index recovered to gain 0.2%.
The Indonesian government has prepared a 120 tril rupiah (RM34.66 bil) stimulus package to support Southeast Asia’s biggest economy. – March 13, 2020, Reuters
