Most Southeast Asian stock markets edged higher on Thursday, with Indonesian shares gaining the most, as hints of progress in talks to resolve the US-China tariff dispute lifted investor mood and tempered a shadow over the global economic outlook.
US President Donald Trump on Wednesday said a deal to end the longstanding trade war between world's two biggest economies, which has caused a pall over global fiscal growth, could happen sooner than expected.
Trump's comments sparked a rally in global equities but gains in Southeast Asia were limited in a low-volume trading session as the unpredictable nature of the trade spat has caused immense volatility in the regional markets over the past year.
"Market sentiment remains fragile and ultra-sensitive to any development around the US-China trade conflict," Han Tan, market analyst at FXTM said in a note.
Leading gains in the region, Indonesian stocks marked their best session in a month, underpinned by financials.
Lenders Bank Central Asia Tbk PT and Bank Rakyat Indonesia (Persero) Tbk PT rose 1.9% and 1.2%, respectively.
Thai stocks edged up 0.6% after the central bank stood pat on interest rates. The Bank of Thailand on Wednesday scaled down its 2019 economic and export forecast, with analysts at OCBC expecting a rate cut in the fourth quarter.
The Singapore index was trading steady ahead of the release of its monthly industrial production figures, which are expected to contract by 0.7% on-year.
The Philippine benchmark index dipped as investors kept a cautious stance ahead of the Bangko Sentral ng Pilipinas policy decision later in the day where a 25 bps cut is largely anticipated.
Losses in the industrial sector weighed, with International Container Terminal Services Inc and Alliance Global Group Inc being the biggest drags in the index.
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