SE Asia shares recover but virus fears remain

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Stock markets in Southeast Asia recovered from their session lows on Friday as US futures rose, but fears of a new wave of coronavirus infections dampened hopes of a global economic recovery as countries emerge from their lockdowns.

Singapore and Kuala Lampur both ended 0.7 percent lower, rallying well off lows after losing more than 3 percent earlier.

Asian markets had taken their early bearish leads from Wall Street, where the three major US stock indexes fell more than 5 percent on Thursday, posting their worst day since mid-March.

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“Certainly not going to judge it today as it’s Friday and the markets will try to settle in around current ranges and take a pause to reassess next week,” Stephen Innes, the chief global markets strategist at AxiCorp said.

Among emerging market currencies, Indonesia’s rupiah faced the brunt of the sell-off, ending 0.7 percent weaker against the dollar in a week that saw it drop 1.4 percent as the number of domestic coronavirus infections spiked to around a 1,000 a day.

The currency did regain some ground from a 1.5 percent drop earlier after the central bank intervened in the spot and domestic non-deliverable forward markets.

In Jakarta, equity markets ended higher after losing as much as 2.9 percent earlier. It marked the first weekly loss in three, a sign that the recent rally may have been overdone.

A central bank survey on Friday showed consumer confidence tumbling to its lowest in 15 years in May.

Thai shares plunged 3.7 percent over the week, ending a four-week winning run even as the country plans to lift a national curfew and ease restrictions further next week after largely bringing local infections under control.

But with tourism a big contributor to growth and with bars to remain closed, there still remains some way to go. The baht fell 0.2 percent to 30.98 per dollar.

Like China and much of the developed world, Southeast Asian countries have been steadily easing lockdown measures that have hammered their economies and are hoping for a swift reboot in the weeks ahead.

Philippine financial markets were closed for a public holiday.

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