Southeast Asian stock markets rose on Monday as easing tension in Egypt and expectations of slowing inflation in China revived appetite for emerging equities with good buying interest in energy stocks and banks. The region's rebound, however, came in relatively weak volume, reflecting caution against rising inflationary pressure on profits of Southeast Asian companies.
Indonesia and Malaysia both saw turnover falling to about 0.7 times their 30-day average, ahead of market a holiday on Tuesday. Others also had similar trading volume, including Thailand's 0.7 times. Fund flows were mixed. Indonesia gained nearly $200 million, the largest in more than two months, while the Philippines saw $8 million of foreign money flowing out after combined $88 million outflows of the past nine sessions, Thomson Reuters data showed.
Malaysia's outflows totalled $69 million, after $572 million last week, while Thailand's inflows were $65 million, after last week's $366 million in outflows, according to exchange data. Nomura International expects Asia and emerging markets to continue to underperform developed markets, with the US and Japan stock markets among its preferences.
Singapore stocks and Malaysia each gained almost one percent on Monday after both posted their biggest weekly loss in almost nine months last week. Indonesia, Southeast Asia's second-worst performer this year after the Philippines, ended up 0.7 percent, while Thai stocks, the third worst, climbed 1.8 percent.
Vietnam fell 1.1 percent, extending bearish sentiment from last week, after a dong devaluation on concerns about inflation in February and possible hikes in prices of electricity from March. See for Vietnam's stock report. Among outperformers, Metropolitan Bank & Trust Co, the Philippines' second-largest bank by assets, gained 2.4 percent after over 10 percent drop last week, and Thailand's Kasikornbank jumped almost 6 percent.
Singapore-listed commodities firm Olam International rose as much as 2 percent to S$3.08 on Monday after Deutsche Bank upgraded the stock to buy from hold and raised its target price to S$3.60 from S$2.68. The stock hit the lowest since September last week.