MOST Southeast Asian stock markets posted gains on Thursday as investors cheered a massive US stimulus package to soften the coronavirus pandemic’s economic blow, although Singapore fell after signalling a severe recession.
Singaporean equities ended 0.7% lower as the city-state cut its annual growth forecast to account for the impact of the virus after data showed the economy’s first-quarter contraction was the worst in a decade.
The index pared some losses after the city-state unveiled new measures worth more than US$30 bil (RM130.05 bil) to help businesses and households cushion the pandemic’s financial hit.
The new measures include a draw on national reserves for the first time since the global financial crisis.
“The latest set of figures has confirmed our fear that a recession is inevitable amid the impact from the Covid-19 outbreak,” DBS Group Research analyst Irvin Seah wrote in a note, referring to Singapore.
Calling the services sector a drag on growth, Seah said, “If the services sector falls, the economy follows.” The industry accounts for the bulk of jobs and is one of the biggest contributors to gross domestic product.
Meanwhile, the rest of the region rode a wave of optimism after the US Senate passed a US$2 tril stimulus bill in a bid to aid unemployed workers and industries hurt by the pandemic.
The Indonesian bourse, which was closed for trading on account of a local holiday on Wednesday, recorded its best session in over two decades, with a 10.2% gain.
In an added boost to sentiment, the central bank said it was ensuring the financial system had sufficient liquidity even as it prepared to implement shorter trading hours to contain the contagion.
Philippines climbed 7.4% in its best session in almost 13 years, with real estate and consumer stocks leading gains.
Thai stocks gained 1.1% as the central bank pledged liquidity support to money markets and daily fixed-income funds that are hit by a cash crunch. – March 26, 2020, Reuters
