Most Southeast Asian stock markets clawed higher in light volume on Thursday as local buyers nibbled at beaten-down heavyweights, although uncertainty remained over the eurozone's debt problems. Turnover was some way below the monthly average and foreigners took cash out of several markets, including Malaysia, Indonesia and Thailand.
Malaysia saw steady buying from domestic institutions towards the end of the July-September quarter and local buyers were also active in Thailand and Indonesia. But investors remained nervous about developments in Europe and it was far from certain that regional markets had touched bottom. Investors were looking forward to a vote in Germany's parliament on new powers for the eurozone's rescue fund.
Bangkok-based Phatra Securities expected Thailand's SET index to slide to 920 later in the year. It closed at 926.21 on Thursday, down 0.6 percent on the day. "It's hard to tell where the market's bottom is but we should expect further market downside, given global situations are not stable," said Therapong Vachirapong, Phatra's head of equity research.
"To a certain extent, there should be some global economic impact on Thailand as it has an open economy. We're cutting stocks with exposure to external factors such as petrochemicals, refineries and exports," he said. Late buying sent Malaysian shares up 1.2 percent and Indonesia 0.7 percent higher.
Stocks in Singapore and the Philippines posted limited gains. Vietnam fell 1.4 percent, extending its loss into a second day to a one-month low. Singapore shares may be volatile in the remaining three months of this year but a year-end rally is probable, with the Straits Times Index (STI) perhaps climbing back to 2,800, broker AmFraser Securities said. That compared with 2,708 at the close on Thursday.
"Records show that at year-end, the STI should be much higher than the lows in preceding months. Even if STI touches 2,500 this quarter, we can expect it to climb back to 2,750-2,800 at least by end-2011," said head of research Najeeb Jarhom. Asia in general edged higher, with MSCI's broadest index of Asia Pacific shares outside Japan up 0.2 percent by 1029 GMT.
Malaysia said domestic institutions bought a net 208 million ringgit ($65.8 million) of stocks, while foreign investors sold 181 million ($57.2 million), exchange data showed. Thailand reported 453.8 million baht ($14.6 million) in outflows, Indonesia posted $24.6 million in outflows but the Philippines took in $24 million in foreign money, according to Thomson Reuters and stock exchange data. Analyst Purwoko Sartono of broker Panin Sekuritas in Jakarta expected the Indonesian index to hit 3,100 in the near term, versus Thursday's close of 3,537.18, but it could rebound later. Among actively traded stocks, Indonesia's top listed firm, Astra International, gained 3 percent and Malaysia's Petronas Chemicals rose 1.3 percent.