BENGALURU: Equities in Asian emerging markets rallied the most in over two years on Thursday, while most currencies firmed, as US President Donald Trump’s temporary pause on some of his harshest tariffs triggered a buying spree of beaten-down stocks.
An MSCI gauge of EM Asian stocks leapt 4% in its biggest one-day gain since mid-November 2022. A subset of equities in ASEAN countries jumped 5%, logging its best day since the start of the COVID-19 pandemic.
Most regional currencies also appreciated against the US dollar. Malaysia’s ringgit
and Indonesia’s rupiah rose 0.5%. The rupiah had hit an all-time low on Wednesday.
Trump’s abrupt about-face came after his punitive tariffs set off a carnage in global financial markets that sent equities plunging towards bear territory at a breakneck pace, sparked a sell-off in US Treasuries and erased trillions in value.
Singapore’s FTSE Straits Times index surged as much as 9% after shedding 15% from a record high in less than two weeks. Benchmarks in Indonesia, Malaysia and Thailand also jumped about 5%.
Taiwan’s stocks soared more than 9%, while South Korea’s KOSPI index advanced 6.6%.
In the Philippines, stocks ended 1.2% higher minutes before the central bank slashed its key interest rate by a quarter-point, as widely expected. The Philippine peso remained anchored around 57.3 per dollar.
“The 90-day pause in reciprocal tariffs seems to reduce the likelihood that Emerging Asia is headed for its worst GDP (gross domestic product) outcomes in this highly fluid moment in global economic history,” Barclays said in a note.“But it does not, in our view, mean that the region is out of the woods yet.”
Trump’s temporary relief excluded China, Southeast Asia’s largest trading partner and investment source.