Southeast Asian shares were largely lower on Thursday, in line with broader Asia, with the Philippine index losing ground for a sixth session as President Rodrigo Duterte's threats to the United States spooked investors. Asian shares fell after disappointing earnings from technology giant Apple dragged on Wall Street, while oil prices were stable, but below $50/barrel. Duterte, who is visiting US-ally Japan, kept up his recent tirade against the US on Wednesday saying he might end defence treaties with Washington.
"At first we were not really taking it seriously, but right now there is an impact on the market because he's (Duterte) been consistent lately," said Mikey Macainag, analyst with Manila-based Sunsecurities Inc. Philippine and US military officials will meet next month to decide the fate of decades-old joint exercises, according to defence sources. The Philippine index, which fell as much as 0.9 percent, is on track for a sixth session of losses led by financials and industrial stocks.
Property developer SM Prime Holdings was among the top losers on the index, falling 2 percent. "Moving forward...for some companies that lease property, the rental income from the BPO industry will be affected," Macainag added. Indonesian stocks bucked the trend to rise as much as 0.5 percent, with trading volumes nearly twice the 30-day average, boosted by financials and telecommunication services.
Index heavyweights Telekomunikasi Indonesia and Bank Mandiri rose 1.4 and 2.0 percent respectively. "(Telekomunikasi Indonesia)'s earnings continue to give positive surprise... valuation remains attractive compared with regional telecommunication rivals," said Mandiri Sekuritas in a note. Thailand shares rebounded from Wednesday's losses led by financials and energy, while Singapore, Vietnam and Malaysia were flat-to-low.
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