Emerging Markets - Asian stocks rise, FX steady; all eyes on US inflation data
HANOI (Reuters): Malaysian stocks jumped on Tuesday to hit their highest level in more than 1-1/2 years as Asian equities rose and currencies held largely steady ahead of a US inflation report that could offer more clues on the Federal Reserve's interest rate-cut timing.

Kuala Lumpur equities rose as much as 1.4% to their highest level since June 2022. Stocks in Thailand and South Korea advanced 0.4% and 1%, respectively.

Currencies in the region were largely steady, with the Singapore dollar and Malaysia's ringgit inching 0.1% lower, while the Thai baht rose 0.4%.

The market focus is on January's U.S. inflation report due later in the day, which will likely provide further clarity on how soon, and by how much, the Fed could cut rates this year.

Analysts at Sumitomo Mitsui Banking Corp (SMBC), however, suggested the US inflation report will likely have a limited impact on markets because it is unlikely to change traders' views on the Fed's first rate cut, which is now expected to occur in May or June.

Back in Asia, the Indonesian rupiah was marginally lower after rising 0.1% earlier in the session to reach its highest level since Jan. 16. Jakarta stocks fell 1.3%. Indonesia is set to hold simultaneous presidential and legislative elections on Wednesday.

"The focus is on how much Prabowo, who has the largest support of voters according to the polls, can have the lead in order to prevent a runoff," analysts at SMBC wrote.

Two opinion surveys last week projected Defence Minister Prabowo Subianto, who is making his third run to be president, could secure more than 50% of the votes on Wednesday, allowing him to win in a single round.

"If he fails to win more than 50% of the total votes, a runoff election will take place in June. This means that political uncertainties will remain longer, which will weigh on IDR," SMBC analysts added.

The stability of the rupiah has been a key concern for Bank Indonesia, with the central bank saying the room to cut rates is dependent on the currency. In the Philippines, stocks rose 0.3% and the peso edged up 0.1%.

A meeting of Philippine monetary authorities has been moved a day ahead to Wednesday, but the central bank's decision on the benchmark interest rate will come as scheduled on Thursday.

Annual inflation in the Philippines accelerated at its slowest pace in more than three years in January, in line with the regional trend of slowing inflation, making a case for central banks to consider interest rate cuts sooner.

Markets in China are closed for the Lunar New Year holidays and will resume trade on Monday, Feb. 19. Investors are waiting to see what Chinese authorities could do next to shore up the country's battered stock market after appointing a new markets regulator just before the break. - Reuters
Asean,Forex,Steady,Stocks,Rising,Emerging Markets
Malaysian stocks jumped on Tuesday to hit their highest level in more than 1-1/2 years as Asian equities rose and currencies held largely steady ahead of a US inflation report that could offer more clues on the Federal Reserve's interest rate-cut timing.