Southeast Asian stock markets, except Thailand, ended lower on Tuesday as risk appetite took a hit after North Korea fired a missile that flew over Japan, sharply escalating tensions on the Korean peninsula and prompting investors to seek safer assets. The test of the missile, which landed in waters off the northern region of Hokkaido early on Tuesday, was one of the most provocative ever from the reclusive state and came as US and South Korean forces conduct annual military exercises on the peninsula.
World stocks slipped while safe-haven assets jumped, with gold prices hitting over nine-month highs and the Japanese yen at its highest in more than four months against the dollar. In Southeast Asia, the Singapore index ended 0.6 percent lower, hurt by financials and telecom stocks.
Oversea-Chinese Banking Corporation Ltd ended 0.5 percent lower, while Singapore Telecommunications Ltd closed at its lowest in nearly nine months. "Bank stocks are weakening on (US Federal Reserve Chair) Yellen's speech last Friday, as the odds of an interest rate hike in December have dropped and investors are pricing in a less steep yield curve going forward, which implies that net interest margins at banks will not rise as rapidly as previously expected," said Liu Jinshu, director of research at NRA Capital. Philippine stocks hit a more than two-week closing low on weaker industrial and real estate stocks.
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