Asian stocks weighed by growth worries, Philippines in view

* Eyes on Philippines meeting

* Asia FX under rates pressure

* Yields on long-tenor bonds in Singapore fall 45 bps

By Riya Sharma

May 19 (Reuters) - The Philippine peso firmed on Thursday ahead of a central bank rate decision, while Asian shares tracked a Wall Street tumble on mounting concerns surging inflation is eating into retail demand and may usher in an economic slowdown.

Shares in India .NSEI and Taiwan .TWII slipped over 2% each, leading losses among Asian equities.

On Wall Street overnight, earnings updates from retail giants tarnished global markets sentiment, with Target Corp TGT.N warning of a bigger margin hit due to rising fuel and freight costs as it reported its quarterly profit had halved. Walmart Inc WMT.N warned of a similar squeeze.

It was the worst one-day loss for the S&P 500 and Dow Jones Industrial Average since June 2020.

Ahead of a policy meeting on Thursday, Bangko Sentral ng Pilipinas (BSP) said its space for maintaining accommodative monetary policy was shrinking, amid rising inflation risks and the economy returning to pre-pandemic levels.

Stocks in Manila .PSI fell 0.7%, in tandem with other regional equities, while the Philippine peso PHP= edged up 0.2%, as markets expected a 25 basis point raise in reverse repurchase facility rate PHCBIR=ECI , according to most economists in a Reuters poll.

"Given Philippine's stronger growth trajectory, stronger first quarter GDP, and the fact that inflation is a bit off target, now seems to be an appropriate time to begin policy normalization," said Khoon Goh, head of Asia research at ANZ.

Regional currencies came under pressure too, even as the U.S. dollar eased, as risk sentiment remained fragile after U.S. Federal Reserve Chair Jerome Powell ratcheted up the hawkish rhetoric on Wednesday by saying the bank would push interest rates as high as needed to stem inflation.

South Korean shares .KS11 fell more than 1% while the won KRW-KFTC led losses among regional currencies, as foreigners sold a net 46.3 billion won ($36.37 million) worth of shares on the main board.

U.S. bond yields fell and the curve flattened, following the risk-off mood in equities markets, which saw investors seek demand in safe assets.

The Indonesian rupiah IDR= remained under pressure amid subdued risk sentiment and bond outflows, falling 0.2%, while long-tenor bonds in Singapore SG10YT=RR , seen as a safe-haven bet, saw yields slip 45 basis points to 2.715%.

HIGHLIGHTS: ** In the Philippines, top index losers are SM Investments Corp SM.PS down -3.45% at 840 pesos; International Container Terminal Services Inc ICT.PS down -1.93% at 213.6 pesos; ** Central Bank of Sri Lanka held its key lending and borrowing rates steady on Thursday following a massive 700 basis points increase at its previous meeting and reiterated the need for more fiscal measures and political stability in the economy

Asia stock indexes and

currencies at 0439 GMT






% Japan


-0.47 -10.6 <.N2 -1.90 -8.32

7 25>



-0.09 -5.98 <.SS -0.08 -15.29





-0.09 -4.28 <.NS -1.89 -8.18


Indonesi IDR=

-0.20 -3.16 <.JK


3.63 a


Malaysia MYR=

-0.14 -5.35 <.KL -0.23 -1.03


Philippi PHP=

+0.17 -2.62 <.PS -0.73 -6.23 nes



-0.53 -6.64 <.KS -1.21 -12.88



Singapor SGD=

+0.36 -2.73 <.ST -0.41

2.83 e




-0.17 -6.96 <.TW -1.98 -12.32


Thailand THB=TH

+0.12 -3.52 <.SE -0.78 -3.01


Graphic: World FX rates Link
Asian stock markets Link

Reporting by Riya Sharma in Bengaluru; Editing by Sam Holmes

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.