Asian stocks rise, inflation data boosts Philippine peso

Asian stocks rise, inflation data boosts Philippine peso

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Most Asian equities edged higher on

Tuesday on signs of thawing China-U.S. tensions, while the

Philippine peso outperformed currencies in the region on bets of

further interest rate hikes after data showed a spike in


Stocks of trade-reliant Asian countries like the Philippines

, South Korea and Indonesia surged between

1.7{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9} and 1.9{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9}.

Uneasy Asian equities got some relief from a report that

U.S. president Joe Biden was leaning towards a decision on

easing tariffs on goods from China.

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China’s commerce ministry said Vice Premier Liu He had a

“constructive” exchange via a video call with U.S. Treasury

Secretary Janet Yellen on Tuesday.

“Tariff lifting will more likely be for the more

inflation-sensitive goods, so on balance it should be positive

for Asian equity markets, as it should help facilitate trade,”

said Mitul Kotecha, senior EM strategist with TD Securities.

“But it comes against a backdrop where global trade is

declining and Asia trade patterns are also worsening.”

Data showing China’s services activity grew at the fastest

pace in almost a year also helped sentiment in Asia.

Rising oil and gas prices boosted energy stocks in

Indonesia, the region’s major energy exporter, with the

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benchmark index climbing 1.7{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9} and set to mark its best

session in over two weeks.

The baht pared losses to trade flat and the peso

rose as much 0.2{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9}, while most Asian currencies were

largely trading lower against a strong dollar.

Philippine consumer prices in June were 6.1{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9} higher than a

year earlier. That inflation rate was the highest in nearly four

years and cemented expectations for more interest rate rises. It

also increased the prospect of the central bank acting more

aggressively to temper price pressures.

The narrowing gap between Philippines and U.S. interest

rates has weighed on the peso, which is trading near a

17-year low against the U.S. dollar.

Thailand’s headline consumer price index (CPI) jumped 7.66{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9}

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in June from a year earlier, a stronger increase than expected,

driven up by higher energy prices, compared with a forecast for

a 7.50{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9} rise in a Reuters poll.

“The baht and peso are certainly off the lows as

above-forecast core inflation may spur the central bank in

Thailand to hike rates, and surging inflation numbers in the

Philippines have also solidified expectations for more interest

rate hikes,” added Kotecha.

In South Korea, consumer prices were 6.0{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9} higher in June

than a year earlier. The annual rise was the fastest since 1998

and fanned expectations the central bank could deliver a 50

basis point rake hike next week.

Nonetheless, the inflation rate was not much higher than


Stocks in Seoul rose as much as 1.9{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9}, rebounding

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from a 20-month low, while the won slipped 0.3{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9}.


** Indonesian 10-year benchmark yields are up 3.4

basis points at 7.306{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9}​​

** Top gainers on FTSE Bursa Malaysia Kl Index include

Petronas Dagangan Bhd up 1.84{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9}, PPB Group Bhd

up 1.67{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9}, and Inari Amertron Bhd up ​1.57{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9}

Asia stock indexes and

currencies at 0715 GMT


DAILY YTD {3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9} X S S YTD

{3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9} DAILY {3b930a6ca12a59604e1bbadfc55b7d1b7a0aa8613f1ab9377cace0d5afcb5fb9}


Japan -0.32 -15.4 <.n2>

China EC>

India -0.15 -6.00 <.ns ei>

Indones -0.17 -4.94 <.jk ia se>

Malaysi -0.11 -5.71 <.kl a se>

Philipp -0.05 -7.48 <.ps ines i> 1

S.Korea 11> 5

Singapo -0.19 -3.53 <.st re i>

Taiwan -0.10 -7.00 <.tw ii> 4

Thailan -0.25 -6.63 <.se d ti>

(Reporting by Riya Sharma in Bengaluru; Editing by Amy Caren




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