South-east Asia stocks fall after Fed hike, Thailand hits six-month low

Thai shares fall 1 per cent, dragged by energy and material stocks. — Reuters pic
Thai shares fall 1 per cent, dragged by energy and material stocks. — Reuters pic

SINGAPORE, June 14 — South-east Asian stock markets traded lower today, with Thai shares hitting six-month lows, after the US Federal Reserve raised rates, as expected, and took a more hawkish tone regarding the pace of rate hikes for the rest of the year.

The Fed yesterday raised its benchmark overnight lending rate a quarter of a percentage point and signalled two additional hikes by the end of this year compared to one previously, based on board members' median forecast.

The revision is only on the basis of one policymaker's change. As such, the Federal Open Market Committee (FOMC) members remain divided on 2018 policy outlook. The median rate hike for 2019 remains unchanged at three times, OCBC Treasury Research said in a note.

Meanwhile, US President Donald Trump will meet with his top trade advisers today to decide whether to activate threatened tariffs on billions of dollars in Chinese goods, a senior Trump administration official said.

In the European Union, recent comments from top European Central Bank (ECB) officials have sparked expectations that the ECB may offer clues on its intentions to end its bond purchases by the end of year at its upcoming meeting.

Thai shares fell 1 per cent, dragged by energy and material stocks. Siam Cement Pcl dropped as much as 2.3 per cent to a more than two-year low and PTT Pcl fell nearly 1.5 per cent.

Singapore shares fell for a third straight session and hit their lowest since April 4.

Big banks DBS Group Holdings Ltd and Oversea-Chinese Banking Corp Ltd slipped more than 0.8 per cent each, while top taxi operator ComfortDelgro declined 4.5 per cent.

Philippine shares fell more than 1.6 percent to a two-week low, with SM Prime Holdings Inc shedding 3.7 per cent.

Malaysian shares were headed for a fifth straight session of fall, dragged by telecom and financial stocks.

Indonesian, Malaysian, Philippine and Singapore markets are closed on Friday for local holidays. — Reuters

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