Most Southeast Asian stocks erased early gains to end in the red on Wednesday with Malaysia losing the most, as disappointing Chinese economic data and a barrage of other dismal economic indicators stoked fears of a slowdown. In China - the region's largest trading partner - the Caixin/Markit PMI slipped into contraction territory for the first time in 19 months in December, broadly tracking an official survey released on Monday.
With the fresh data, together with a fall in industrial profits, and softer retail sales growth in November, "we can confirm that the economy is weakening," Iris Pang, economist, Greater China at ING said in a note to clients. China's weakness spilled over to other Asian economies, with Malaysia's manufacturing activity in December shrinking to its weakest pace of expansion since it launched the survey in 2012.
Adding to the worries, official economic data out of export-reliant Singapore showed its gross domestic product grew more slowly than forecast in the fourth quarter as its manufacturing sector contracted on a quarterly basis. The Malaysian benchmark index was the worst performer in the region, shedding 1.3 percent, with shares of Sime Darby Plantation Berhad falling 4.4 percent, while those of oil and gas services provider Dialog Group Berhad ending 3.5 percent lower.
Singapore's index followed suit, tumbling nearly 1 percent. Shares of industrial conglomerate Jardine Matheson Holdings Ltd and lender UOL Group Ltd lost 2.4 percent and 1.9 percent, respectively.
The Indonesian index also edged lower on the back of material and telecom stocks.
Meanwhile, Indonesia's December annual inflation rate eased, but the pace was quicker than expected, data from the statistics bureau showed on Wednesday.
Bucking the trend, Philippine's index rose as strong gains in real-estate stocks offset losses in most other sectors. Driving the benchmark was heavyweight Ayala Land Inc's counter, which bounced back after falling for two consecutive weeks.
Shares of property developer SM Prime Holdings Inc along with Ayala Land were among top boosts to the index, up 3.4 percent and 1.7 percent, respectively.
Thailand's index edged up, with financials and energy stocks underpinning gains.
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