Asian shares rise ahead of U.S. inflation data

Article content

Most Asian currencies slipped in thin

trading on Monday, while stock markets in the region perked up

Article content

on hopes that a key reading on U.S. inflation might show some

signs of cooling.

Stocks in Taipei settled 1.5% higher in their best

session in a month, while shares in Manila and Bangkok

were also firmer. Markets in China, South Korea and Hong

Kong were closed for holidays.

“A weaker dollar is providing some boost to risk appetite.

Markets are taking their cue from the price action on Friday in

Article content

the U.S.,” said Irene Cheung, a senior Asia strategist at ANZ in

Singapore.

On Friday, major Wall Street indexes recorded their first

weekly gain in four as investors went on a buying spree,

shrugging off concerns about the economic outlook.

Investors are waiting for Tuesday’s U.S. CPI report after

Federal Reserve officials continued their hawkish rhetoric on

Friday.

Bulls are hoping U.S. consumer prices will hint at a peak

for inflation. Falling petrol prices are seen pulling down the

headline index by 0.1%, according to a Reuters poll.

In currencies, the Thai baht and the Philippine

peso weakened between 0.3% and 0.4%.

Indonesia’s rupiah and the Malaysian ringgit

dipped 0.1% each, even as the dollar hovered near a two-week

Article content

low. The dollar was restrained by the risk of higher European

interest rates and Japanese intervention.

“Despite the dollar pullback this morning, the fundamental

drivers for some of the weaker Asia currencies have not

changed,” Cheung said.

Over the weekend, a Japanese official said the government

must take steps to counter excessive declines in the yen, after

the currency hit its weakest level against the dollar in 24

years. The yen was down 0.3% on Monday.

This week, investors will keep an eye out for a slew of

August economic data from China. India’s inflation report is

expected later in the day.

A Reuters poll found that India’s retail inflation likely

snapped a three-month downward trend in August as food prices

Article content

surged. That may add pressure on the Reserve Bank of India to

raise interest rates more aggressively in coming months.

The rupee was flat, while stocks rose 0.8%

to their highest since Aug. 19.

Asian currencies have come under downward pressure in recent

months, driven by a slump in the Chinese yuan and a

towering dollar.

Meanwhile, the Financial Times reported Indonesian President

Joko Widodo was considering joining India and China in buying

Russian oil to alleviate increasing pressure of rising energy

costs in the country.

HIGHLIGHTS

** Yield on Indonesia’s 10-year benchmark bond

falls to 7.146%, lowest in a week

** Taiwanese shares rise most in more than a month

** Indonesia considering buying Russian oil as fuel prices

soar – FT

Asia stock indexes and currencies at 0659 GMT

COUNTRY FX RIC FX FX YTD INDEX STOCK STOCKS

DAILY % S YTD %

% DAILY

%

Japan -0.34 -19.52 1.16 -0.87

China – -8.30 – -10.38

India +0.01 -6.59 0.77 3.55

Indonesia -0.05 -3.95 -0.02 10.03

Malaysia -0.13 -7.51 0.04 -4.49

Philippines -0.26 -10.47 1.26 -6.08

S.Korea – -13.90 – -19.93

Singapore +0.04 -3.49 0.30 4.77

Taiwan -0.01 -10.38 1.54 -18.72

Thailand -0.34 -8.28 0.82 0.64

(Reporting by Harish Sridharan in Bengaluru; Editing by

Subhranshu Sahu)