EMERGING MARKETS-Asia shares eye best week in months, TSMC surge boosts Taiwan stocks

Reuters
18 Jul
EMERGING MARKETS-Asia shares eye best week in months, TSMC surge boosts Taiwan stocks

Bangkok stocks set for best week since June 2020

Indonesia shares rise for 10th straight session

TSMC gains 2%

By Rishav Chatterjee

July 18 (Reuters) - Emerging Asian stocks extended gains on Friday and were poised for their strongest weekly performance in months, as investors looked beyond U.S. tariff risks to focus on upbeat corporate earnings and dovish central bank tilts.

The MSCI gauge of equities in emerging Asia .MIMS00000PUS jumped 0.6%. In Southeast Asia, stocks in Indonesia .JKSE, Singapore .STI, Malaysia .KLSE, and the Philippines .PSI gained up to 1.4%.

Thailand's benchmark index .SETI rose 1%. It has surged almost 7% for the week and was set for its biggest gain since June 2020, driven by inflows on news that the government would propose to Cabinet a new central bank chief with a dovish bias.

Stocks in Taiwan .TWII climbed 1.5% to hit their highest since February 27, fuelled by a rally in TSMC 2330.TW, which surged 2% after posting record quarterly profits and lifting its full-year sales forecast.

The index has gained more than 2.7% this week, heading for its best performance since mid-May.

"The strong overnight performance of TSMC's ADR following the firm's announcement of better-than-expected 2Q25 EPS and 2025 sales guidance, bodes well for the Taiex today," said analysts at KGI Securities.

"We expect the Taiex to rise 250-300 points and challenge the intraday high of 23,400."

Optimism around Nvidia's NVDA.O H20 shipments further lifted sentiment in Taipei, extending the rally in tech shares.

In Indonesia, the benchmark .JKSE rose for a tenth straight session and touched its highest level since December 13. It was on track for its strongest weekly gain since early March.

Investor sentiment was buoyed by Bank Indonesia's rate cut and signals of further easing, following a newly inked trade agreement with Washington — the second such deal in Southeast Asia after Vietnam.

"Besides lowering rates, we expect more verbal suasion on banks to lower borrowing costs to provide relief. We have another 25bp cut in our baseline view, taking the rate to 5.0%," said Radhika Rao, senior economist at DBS.

In forex markets, most Asian currencies gained modestly against a steady U.S. dollar, but were losing ground over the week. The dollar index was on track for a second straight weekly rise, buoyed by solid economic data and resilient earnings from heavyweights.

The Indonesian rupiah IDR= was on pace for its weakest weekly performance since April’s record low, while the Singapore dollar SGD= and Taiwan dollar TWD=TP were both set for second consecutive weekly losses.

The Philippine peso PHP= slipped 1.1% over the week, while the Thai baht THB=TH stood out, rising 0.1%.

With the earnings season in full swing and signs of policy support building across Asia, investors are finding reasons to stay bullish, even as the uncertainty persists.

HIGHLIGHTS:

** Malaysia's economy grew 4.5% y/y in Q2

** Singapore's exports rise 13% annually in June

Asian currencies and stocks as of 0358 GMT

COUNTRY

FX RIC

FX DAILY %

FX YTD %

INDEX

STOCKS DAILY %

STOCKS YTD %

Japan

JPY=

-0.04

+5.73

.N225

-0.25

1.26

China

CNY=CFXS

-0.01

+1.64

.SSEC

0.34

5.28

India

INR=IN

+0.02

-0.52

.NSEI

-0.01

6.19

Indonesia

IDR=

+0.15

-1.29

.JKSE

1.47

4.44

Malaysia

MYR=

+0.00

+5.33

.KLSE

0.19

-7.22

Philippines

PHP=

+0.14

+1.68

.PSI

0.13

-3.45

S.Korea

KRW=KFTC

+0.04

+5.79

.KS11

-0.42

32.49

Singapore

SGD=

+0.06

+6.27

.STI

0.45

10.36

Taiwan

TWD=TP

+0.01

+11.46

.TWII

1.15

1.49

Thailand

THB=TH

+0.06

+5.70

.SETI

0.08

-14.36

(Reporting by Rishav Chatterjee in Bengaluru; Editing by Subhranshu Sahu)

((Rishav.Chatterjee@thomsonreuters.com;))

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