Most weaker amid Iraq concerns; Singapore near 3-wk low

Bareksa.com - Southeast Asian stocks mostly fell on Tuesday as investors trimmed risk holdings amid concerns over the Iraq situation and rising crude oil prices, while shares in Singapore hit their lowest in nearly three weeks on disappointing export data.

Brent crude futures, which held near $113 per barrel as concerns over oil supply persisted, weighed on shares of airline firms such as Singapore Airlines, Thai Airways International and Cebu Air.

In Singapore, the key Straits Times Index was down 0.7 percent at 3,269.28, the lowest since May 23.

Singapore's exports unexpectedly fell in May on weak shipments of electronics and pharmaceuticals to its key markets, indicating the city-state may not be benefiting yet from a recovery in developed economies.

The Philippine main index dropped almost 1 percent to 6,696.07, the lowest since June 2.

Other markets in Southeast Asia were nearly flat, with Kuala Lumpur's composite index little changed at 1,870.94. Analysts at Maybank IB Research said Malaysia is the only net oil exporter within ASEAN 5-major and is a saver spot.

They maintain their 2014 target for the index at 1,940, saying the year will be mildly positive for the plantation sector with more for the oil and gas services providers if oil prices are sustained at high levels.

"Being a net oil exporter, coupled with the fact that around one-third of the government's revenue is derived from the oil & gas sector, higher crude oil prices are a positive for Malaysia from trade and budget perspectives," they wrote in a report.

In Bangkok, the SET index inched up 0.1 percent, helped by gains in consumer shares such as CP All as the ruling military government works on reviving the domestic economy.

The Bank of Thailand is expected to keep its policy interest rate steady in a meeting on Wednesday, with less pressure to trim its interest rate further.

"While the efficacy of fiscal policy under the military government (or the interim government said to be in August) is still uncertain, it is clear that it will be pro-growth," broker DBS said in a report.

According to a Reuters poll, the central bank will likely leave its key interest rate unchanged at 2.0 percent, in its first policy review since a military coup, with an end to political gridlock and the junta's spending plans expected to support the economy.
        
SOUTHEAST ASIAN STOCK MARKETS
 Change at 0653 GMT
 Market                    Current     Prev Close    Pct Move
 TR SE Asia Index*   424.32         425.98       -0.39
 Singapore              3269.28       3290.26       -0.65
 Kuala Lumpur         1870.94       1871.58      -0.03
 Bangkok                1473.80       1471.85      +0.13
 Jakarta                  4884.17       4885.46       -0.03
 Manila                   6696.07       6758.45       -0.92
 Ho Chi Minh             571.74        572.37       -0.11
 * The Thomson Reuters South East Asia Index is a highly representative indicator of stocks listed in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.

(Source : Reuters)