BENGALURU: The Indonesian rupiah sank to a record low on Friday, while emerging Asian equities were set for strong weekly gains as investors grew more optimistic the Middle East conflict could be coming to an end.
US President Donald Trump expressed confidence that an agreement could soon be reached to end the war and urged the Tehran-aligned Hezbollah group to hold its fire as a 10-day truce went into effect between Lebanon and Israel.
Some Asian equity markets have recouped losses triggered by the outbreak of the conflict, with shares in Singapore, Taiwan and South Korea climbing back to pre-war levels.
The MSCI gauge of EM Asia equities, which has fallen 0.9 percent since the war broke out, was set to end the week 3.5 percent higher. The broader global EM equities index was on track for a third straight week of gains, rising about 3 percent.
Stocks in South Korea and Taiwan were headed for weekly gains of more than 5 percent and 4 percent, respectively.
“There is a slight risk aversion going into the weekend given the tendency for tensions to flare and conflict to escalate when the markets are closed,” said Kyle Rodda, senior financial market analyst at Capital.com.
In Indonesia, the rupiah slipped to a record low of 17,192 per US dollar, extending losses for 2026 to 3 percent, most of which have come since the conflict erupted in late February.
Shares in Jakarta were on track to end the week with a gain of more than 2 percent. So far this month, Indonesia’s equity markets have seen 6.07 trillion rupiah (USD353.17 million) of foreign outflows, LSEG data showed.
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