Currencies, stocks mixed after China, US data; Thai baht hits 2-wk high

Emerging Asian currencies and share markets were largely mixed on Friday as investors took stock of key economic data from the United States and China, while the Thai baht stood out with gains as it resumed trade after a three-day break.

In Russia, government bonds recouped some losses as investors considered news of US sanctions targeting the country's sovereign debt. The rouble opened 0.1% weaker against the dollar after tumbling 2% on Thursday.

The Thai baht firmed nearly a percent and hit a two-week high as the dollar dipped. The currency, however, could face pressure in the near-term on the back of a record rise in new COVID-19 cases and virus curbs in Thailand.

"Even if the US dollar remains sideways or slightly weaker, Thai baht could weaken further due to worsening COVID-19 situation which is likely to lead to more stringent lockdown measures," said Poon Panichpibool, markets strategist at Krung Thai Bank.

"In this scenario, I expect some selling pressures on Thai risky assets such as stocks and some hospitality-related REITs, which could lead to some fund outflows."

Many regional stock markets were unable to join a global rally, as upbeat US retail sales and manufacturing data as well as record first-quarter economic growth in China were offset by worries over rising infections.

Equities in the Philippines, Malaysia and Indonesia slipped between 0.2%-0.8%.

In Singapore, the local dollar was off 0.2% but remained on track to firm about half a percent for the week. Stocks rose 0.4% to a one-week high after data showed the city-state's exports expanded in March.

US Treasury yields continued to retreat as markets focussed on the Federal Reserve's insistence of maintaining monetary support for an extended period.

"The lower UST nominal yields render some Asian local-currency government bonds more attractive, which shall extend the stabilization recently seen in the IndoGB and Malaysian government securities markets," analysts at OCBC Bank said in a note to clients.

Indonesia's 10-year benchmark yields are at 6.538% after losing more than 36 basis points earlier in April, while Malaysia's 10-year yields edged up from a six-week low hit earlier in the month.