BENGALURU- Emerging Asian equities advanced on Friday and were eyeing a positive end to an otherwise bumpy week after benign US jobs data calmed recession fears and nudged the markets to pare back their bets of aggressive rate cuts by the Fed.
Taiwan’s benchmark index gained about 3 percent while shares in South Korea added 1.4 percent .
MSCI’s gauge of Asian emerging market equities in which the two East Asian countries hold roughly 40 percent weight, jumped 2 percent .
However, the historical sell-off on Monday weighed on the weekly score. Most benchmarks are clocking weekly losses, with those in South Korea headed for their worst levels since mid-April.
Singapore’s FTSE Straits Times which was closed on Friday for National Day holiday, ended the week 3.5 percent lower, its worst since August 2023.
Thai stocks were down 1.2 percent over the week, their biggest drop since June 14.
Currencies were broadly stronger against the greenback on Friday – the Taiwanese dollar added 0.5 percent while South Korea’s won jumped 1 percent .
Taiwan dollar, one of the weakest performers so far this year, could benefit from light foreign positioning and potential rebound in the global tech stocks, which could bring in more flows into equities, analysts at Barclays wrote.
“Headwinds (to Taiwan dollar) from capital outflows have eased significantly. Equity outflows should pause in the short run given the significant selling in July,” they added.
In Southeast Asia, Malaysia’s ringgit appreciated 0.6 percent , while the Philippine peso Singapore dollar and the Indian rupee edged higher.
MSCI’s index of emerging market currencies jumped 0.4 percent to its highest since early April.
Global markets have endured a roller-coaster of a week, with Monday seeing a historical sell-off triggered by massive unwinding of the yen-funded carry trade as data indicated the US Federal Reserve might have to be more aggressive in easing policy at a time when the Bank of Japan (BOJ) looked poised for rate hikes.
