Southeast Asian markets: Singapore, Indonesia, Thailand rebound

The main Southeast Asian stock markets clawed higher on Wednesday as quarterly results and optimism about interest rates lifted banks, with hopes growing that the US Federal Reserve may consider further measures to revive the economy. Late buying helped reverse early losses in most markets as sentiment in Europe picked up initially, although markets there turned lower after the close in Asia.
Indonesia and Singapore rose after two-day falls, with Jakarta's Composite Index rising 2.1 percent and Singapore's Straits Times Index up 1.6 percent. Thai stocks ended up 1 percent after Tuesday's 1.9 percent drop. Most markets fell to a one-week low at one stage amid doubts there could be a quick fix for the euro debt crisis following Greece's surprise call for a referendum on its planned bail-out.
Buying interest remained weak, with market turnover generally falling short of the monthly average. Malaysia edged down 0.3 percent, recouping some of its early losses of 1.2 percent to a one-week low. Philippine shares dropped 1.7 percent, resuming trade after a market holiday, and Vietnam fell 1.5 percent.
The US Federal Open Market Committee, which concludes a two-day policy meeting on Wednesday, may offer hints of further monetary easing to help revive the economy. Among bright spots, Singapore's top lender, DBS Group Holdings, surged nearly 4 percent after it posted better-than-expected third-quarter earnings.
In Jakarta, investors picked up banks on expectations the central bank may cut interest rates at a meeting next week following benign inflation data for October. Top lender PT Bank Mandiri Tbk surged 4.4 percent. "More economists expect a rate cut after the inflation data. Banks gain because lower rates are good for loan growth and non-performing loan accounts," said John Teja, director of broker Ciptadana Securities.
In Thailand, Tipco Asphalt Pcl gained as much as 4.2 percent while top construction firm Italian-Thai Development Pcl rose 2.2 percent on expectations they would benefit from rebuilding work in flood-hit areas. Bangkok's turnover fell to two-thirds of the monthly average as investors worried about the impact of flooding on the economy and corporate earnings. In its ASEAN Equity Strategy dated November 2, Morgan Stanley said it preferred Indonesia and Thailand to Singapore.
"We believe that MSCI Singapore faces downside risk to earnings accompanied by potential structural de-rating of the market. We continue to recommend investors buy Indonesia on dips and sell Singapore on the rallies," it said. Flows in the region were mixed. Malaysia reported inflows of 80 million ringgit ($26 million), Indonesia posted $18 million in outflows while the Philippines had $14 million in inflows, Thomson Reuters and stock exchange data showed.