Friday, March 31

Asia FX, stocks retreat on Russia sanctions caution, dollar strength

Article content

Asian currencies and most regional

share markets weakened on Thursday as US President Joe Biden

sought to persuade European leaders to impose more sanctions on

Russia, while the Federal Reserve’s hawkishness kept global

markets are under pressure.

“Uncertainty, rather than unadulterated fears of demand

shocks, is arguably the main driving force for the current

market dynamics of declining equities, boosted bonds –

corresponding to falling yields – and buoyant commodities,”

Advertisement 2

Article content

analysts at Mizuho Bank said in a note.

MSCI’s broadest index of Asia-Pacific shares outside Japan

dropped 0.6%, while Japan’s Nikkei

retreated from a more than two-month high as a rise in crude oil

prices stoked inflation concerns.

In Asia, South Korean won weakened 0.6%, a day

after the country nominated International Monetary Fund official

Rhee Chang-yong as its new central bank chief. Rhee is expected

to maintain the Bank of Korea’s efforts to curb inflation, while

taking a less hawkish stance than his predecessor.

Elsewhere, Thai baht, Philippine peso,

Singapore dollar and Malaysian ringgit eased

marginally as the US dollar gained ground against major


Overnight, US Treasuries witnessed a sharp sell-off, with

Advertisement 3

Article content

the 10-year benchmark yields retreating from an

almost three-year peak, as investors assessed the US Federal

Reserve’s hawkish stance.

Asian bond markets also suffered a continued sell-off.

Singapore’s 5-year yields edged higher to touch

2.133% for the first time since December 2018.

The 10-year yields in Philippines, Malaysia

and Thailand edged higher, while

Indonesia’s 10-year benchmark yield slipped


Among Asia’s equity markets, Singapore shares jumped

0.8% to their highest in four weeks, led by travel-related

stocks after the city-state further relaxed COVID-19 curbs for

fully vaccinated visitors.

The city-state’s flagship carrier Singapore Airlines

jumped 2.9%, transport services provider ComfortDelGro

Advertisement 4

Article content

Corp advanced 4.2%, while resorts and casino developer

Genting Singapore added 3.8%.

Elsewhere, shares in Indonesia and the Philippines

gained about 0.5% each, while South Korea’s KOSPI

and Malaysian benchmark declined 0.5% and 0.2%,


Meanwhile, the Philippine central bank, in a decision due

later in the day, is widely expected to keep its policy rate


Analysts at TD Securities expect the Bangko Sentral ng

Pilipinas to hike rates in the second half of this year, while a

Reuters poll predicted the overnight repurchase facility would

move up 50 basis points in the last quarter.


** Indonesian 5-year benchmark yields edges lower to 5.615%

** Thai FinMin sees high oil prices, inflation as temporary

** Singapore’s Olam expects delay in IPO of its food

ingredients unit

Asia stock

indexes and


at 0345 GMT




% %

Japan -0.04 -5.05 <.n22>

China C>

India i>

Indonesia -0.10 -0.77 <.jks e>

Malaysia -0.07 -1.44 <.kls e>

Philippines -0.06 -2.65 <.psi>

S.Korea 1>

Singapore -0.01 -0.63 <.sti>

Taiwan i>

Thailand i>

(Reporting by Sameer Manekar in Bengaluru; Editing by Simon




Postmedia is committed to maintaining a lively but civil forum for discussion and encourage all readers to share their views on our articles. Comments may take up to an hour for moderation before appearing on the site. We ask you to keep your comments relevant and respectful. We have enabled email notifications—you will now receive an email if you receive a reply to your comment, there is an update to a comment thread you follow or if a user you follow comments. Visit our Community Guidelines for more information and details on how to adjust your email settings.