EMERGING MARKETS-Asian stocks rise; FX lack direction on steady dollar, Fed rate-cut bets

Reuters
Jan 14
EMERGING MARKETS-Asian stocks rise; FX lack direction on steady dollar, Fed rate-cut bets

.

Taiwan, Indonesia, S.Korea shares log record highs

Singapore stocks slip from previous record

S.Korean won snaps 10-day losing streak

By Shivangi Lahiri and Nichiket Sunil

Jan 14 (Reuters) - Most emerging Asian equities rose on Wednesday, with Taiwan, Indonesia, and South Korea hitting all-time highs, while currencies were flat as U.S. inflation data supported expectations of a Federal Reserve rate hold later this month.

The MSCI EM Asia equity index .MIMS00000PUS and a broader global EM equities index .MSCIEF both touched lifetime highs in the session, rising as much as 0.6% and 0.5%, respectively.

Global central bankers and Wall Street executives backed Fed Chair Jerome Powell after the Trump administration threatened a criminal indictment, underscoring the Fed's global importance.

South Korea's KOSPI index .KS11 and Taiwan's benchmark index .TWII climbed record peaks, rising as much as 0.5% and 0.9%, respectively, as artificial intelligence-linked assets held onto continued strong demand.

The rally in both the tech-heavy benchmarks is consistent with broader global tech trends, reflecting a bias toward growth investing in Asia, said Kenneth Tang, senior portfolio manager at Amova Asset Management.

"The ongoing global AI race is a significant driver of this rally, with Taiwan and South Korea taking leading roles in the semiconductor supply chain, particularly in memory."

Elsewhere, China reported a robust 2025 export run and a record trade surplus of nearly $1.2 trillion.

Meanwhile, Singapore equities .STI slipped from record highs touched on Tuesday, declining 0.1%, which Glenn Yin, director of research at ACCM, attributed to potential profit-taking after several record sessions.

Stocks in Jakarta .JKSE also logged a record high, crossing the key 9,000 mark for the second time since last week.

The Indonesian rupiah IDR= slipped as much as 0.1%, hovering near a record low of 16,970 per dollar last seen in April 2025, before paring losses to trade flat.

Bank Indonesia pledged continued FX intervention, while the finance minister said strong fundamentals would draw inflows.

"Clearer fiscal discipline and improved confidence could allow the currency to recover...," Yin added.

Currencies elsewhere were mostly muted, though the South Korean won KRW=KFTC edged higher to snap a 10-session losing streak.

Yin said the won's slide reflects persistent equity outflows, with any sustained rebound hinging on a reversal in flows, while FX stabilisation bond sales would offer only short-term relief.

Market now awaits the Bank of Korea's rate decision on Thursday, with a Reuters poll expecting it to hold the benchmark rate at 2.50%.

HIGHLIGHTS:

** China stock exchanges tighten margin financing requirements

** South Korea's Lee ordered review to look at restoring North Korea military pact, media says

** China's 2025 rare earth exports hit highest since at least 2014 despite restrictions

Asia stock indexes and currencies at 0500 GMT

COUNTRY

FX RIC

FX DAILY %

FX YTD %

INDEX

STOCKS DAILY %

STOCKS YTD %

Japan

JPY=

-0.06

-1.61

.N225

1.45

6.50

China

CNY=CFXS

+0.05

+0.17

.SSEC

1.20

5.53

India

INR=IN

+0.06

-0.29

.NSEI

-0.12

-1.64

Indonesia

IDR=

-0.02

-1.14

.JKSE

0.85

4.37

Malaysia

MYR=

+0.05

+0.07

.KLSE

-0.06

1.61

Philippines

PHP=

-0.05

-0.95

.PSI

0.05

5.93

S.Korea

KRW=KFTC

+0.06

-2.60

.KS11

0.22

11.60

Singapore

SGD=

-0.01

-0.20

.STI

-0.07

3.39

Taiwan

TWD=TP

-0.01

-0.70

.TWII

0.44

6.49

Thailand

THB=TH

+0.13

+0.03

.SETI

0.89

-1.06

Graphic: World FX rates https://tmsnrt.rs/2RBWI5E

Asian stock markets https://tmsnrt.rs/2zpUAr4

(Reporting by Shivangi Lahiri and Nichiket Sunil in Bengaluru; Editing by Rashmi Aich)

((shivangi.lahiri@thomsonreuters.com))

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