Southeast Asian stock markets lost ground on Friday with investors taking a cautious approach ahead of the Group of Seven (G7) summit this weekend and on expectations of another US interest rate hike. Global risk appetite took a hit after US jobless claims pointed to a further tightening in the labour market, cementing expectations the Fed will raise benchmark rates next week and twice again later in the year.
The widening rift between the United States and its major trade partners after President Donald Trump imposed import tariffs on steel and aluminium imports last week spurred concerns ahead of the two-day G7 meet in Quebec. MSCI's broadest index of Asia-Pacific shares outside Japan fell 1.5 percent, though the index finished the week on a high for the first time in three weeks.
"It's probably a technical weakness since there was no big data (in southeast Asia) this week," said Joel Ng, an analyst at KGI securities.
The Indonesian index was the worst performer in the region, ending 1.9 percent lower, led by financial stocks. Bank Central Asia, Indonesia's largest company by market capitalization, fell 3.2 percent.
However, the Jakarta index gained 0.2 percent for the week, extending gains to a third straight week. Singapore shares fell 1.1 percent on Friday, but ended a third spell of weekly losses. Lenders OCBC and United Overseas Bank lost 2 percent each.
Philippine shares closed 0.8 percent lower, but ended the week up 1.5 percent.
Financial, real estate and industrial stocks pushed the index lower. Real estate firm Ayala Land fell 2.4 percent, while SM Investments dropped 1.5 percent.
Malaysian shares ended lower, but clocked their biggest weekly gain in seven, climbing 1.3 percent. Thai shares fell 0.6 percent, dragged by energy stocks, with PTT Pcl and PTT Exploration and Production losing over 2 percent each.
Vietnam was the sole gainer, reversing early losses to end higher for a seventh session, led by banks. It rose 4.7 percent during the week, its biggest such gain since mid-February.