Southeast Asian stock markets posted small gains on Friday as investors bought resource shares after a rise in oil prices, but indexes were lower on the week as concern grew about the impact of euro debt problems on the global economy. Turnover in some major markets fell well below the 30-day average, notably Indonesia and Thailand. Market weakness is expected to continue in the near term because of expectations of a slowdown in economic growth.
Broker Citi expected another cyclical global slowdown in coming months, with the more externally dependent countries, including Singapore, Malaysia and Thailand, seeing a more pronounced second-quarter slowdown, it said in a note. "After Asia posted stronger than expected economic activity in the first quarter of 2011, we expect external demand buoyed by the global industrial cycle is now softening, coupled with the impact of Japan supply disruptions," it said.
Thailand released a worse-than-expected decline in manufacturing output in April due to the supply chain distributions. Thailand's benchmark SET index inched up 0.15 percent on the day, with trading trapped in a narrow range. Some dealers cited growing market caution ahead of a general election set for July 3. The MSCI index for Southeast Asia was up 0.9 percent by 1004 GMT, while the MSCI index of Asia Pacific stocks outside Japan was up 1 percent.
For the week, Malaysia gained 0.5 percent, the best in Southeast Asia and the third-best in Asia. Palm oil stocks led gainers after a climb in Malaysian palm oil futures. Singapore-listed Golden Agri Resources gained 1.5 percent, while Indonesia's largest listed plantation firm Astra Agro Lestari and Malaysia's second-largest IOI Corporation rose 0.7 percent. Energy and coal miners outperformed, with Thailand's biggest refiner, Thai Oil, up 1.6 percent, and Indonesian coal miner Indo Tambangraya Megah 1.2 percent higher.