Emerging Markets: Asian stocks recover from chip-led selloff; Singapore steady after MAS pause
EMERGING MARKETS-Asian stocks recover from chip-led selloff; Singapore steady after MAS pause By Nikita Maria Jino
Oct 14 (Reuters) - Emerging Asian equities rose on Wednesday from a recent chip-driven selloff, as investors weighed competitive pressures in the semiconductor sector and prospects for AI-related spending, while Singapore shares held firm after a surprise monetary policy hold.
MSCI's broad index of EM Asian equities .MIMS00000PUS advanced 1.3% after the benchmark closed 2.6% lower on Tuesday.
South Korea's KOSPI .KS11 clawed back from a 5.5% drop in the previous session, rising as much as 2.6% earlier in the day. Shares of chipmakers Samsung Electronics 005930.KS and SK Hynix 000660.KS advanced 2.4% and 1.4%, respectively, after hitting multi-week lows on Tuesday.
Regional chipmakers steadied on Wednesday after a global semiconductor selloff as investors weighed the impact of higher bond yields on AI-related spending and reports of technological advances by China's CXMT 688825.SS, which have called into question South Korea's competitive edge in memory chips.
"Korean retail investors are reducing margin loans rather than buying the dip. For much of this year, retail traders have been a relatively steady source of buying support on pullbacks," said Dilin Wu, research strategist at Pepperstone.
Downward pressure for the KOSPI could persist in the near term, depending on a meaningful stabilisation of the broader US AI trade and clearer evidence of the durability of high bandwidth memory (HBM) demand, Wu said.
The KOSPI has shed nearly 35% since its June record high.
Retail investors were among the hardest hit during a selloff in July, when the index fell about 20%, dragged down by losses in highly leveraged single-stock ETFs.
Taiwan stocks .TWII advanced up to 1.5% after a 2% slump in the previous session. The benchmark was supported by a 1.2% gain in TSMC 2330.TW ahead of the world's largest contract chipmaker's earnings report on Thursday, where it is expected to post a sixth consecutive quarter of record profit.
In Southeast Asia, Singapore stocks .STI were flat after the central bank unexpectedly left its monetary settings unchanged.
The FTSE Straits Times index has advanced 0.4% so far this week, after a 4.1% drop last week following a bank selloff.
A strong US dollar and elevated Treasury yields are overshadowing the impact of MAS's policy decision, especially when the index has already taken a hit from an entirely separate catalyst, Wu said.
Among regional currencies, the South Korean won KRW= appreciated 0.3% after notching a two-year peak on Monday.
The Indian rupee INR=IN extended gains to edge higher to 94.9575 per US dollar. Traders told Reuters that the Reserve Bank of India likely intervened in the foreign exchange market to support the currency's recent recovery from near record lows. INR/
The Taiwan dollar INR=IN was an outlier, depreciating 0.4% in its fifth session of declines.
The MSCI EM currencies gauge .MIEM00000CUS marginally edged 0.2% higher in Asian trade.
HIGHLIGHTS:
** Singapore economy grows 5.4% year-on-year in third quarter, preliminary data shows
** Asia must guard against another financial crisis, Philippines central bank chief says
** Europe's carmakers turn back time to rival Chinese EVs
Asia stock indexes and currencies at 0352 GMT | ||||||
COUNTRY | FX RIC | FX DAILY % | FX YTD % | INDEX | STOCKS DAILY % | STOCKS YTD % |
Japan | JPY= | +0.04 | -1.00 | .N225 | 0.79 | 35.70 |
China | CNY=CFXS | +0.01 | +4.42 | .SSEC | 0.01 | -4.23 |
India | INR=IN | +0.24 | -5.45 | .NSEI | 0.00 | -13.04 |
Indonesia | IDR= | +0.00 | -6.79 | .JKSE | 1.05 | -30.75 |
Malaysia | MYR= | +0.08 | -0.61 | .KLSE | 0.51 | -2.88 |
Philippines | PHP= | -0.04 | -6.29 | .PSI | -0.62 | -6.39 |
S.Korea | KRW= | +0.29 | +7.65 | .KS11 | 1.05 | 44.72 |
Singapore | SGD= | -0.08 | +0.40 | .STI | -0.05 | 16.82 |
Taiwan | TWD=TP | -0.42 | -2.43 | .TWII | 1.19 | 68.89 |
Thailand | THB=TH | +0.00 | -6.23 | .SETI | 0.03 | 24.81 |
(Reporting by Nikita Maria Jino in Bengaluru; Editing by Sherry Jacob-Phillips)
((Nikita.Jino@thomsonreuters.com;))
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