Southeast Asian stock markets were subdued on Friday after an agreement by Opec and allied partners to extend existing supply curbs disappointed investors betting on larger cuts, prompting a move away from riskier assets.
The Organization of the Petroleum Exporting Countries and some non-Opec producers agreed to extend a pledge to cut production to March 2018 but investors had expected a longer and/or deeper supply cut.
Crude oil plunged 5% following the announcement on Thursday, and held its losses early on Friday.
In Asia, MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.2% after closing at a two-year high on Thursday.
"Most of our [Southeast Asian] markets have a similar structure in that energy and oil stocks are very big in terms of market-cap contribution to the overall index calculation, so I think the selling pressure in energy stocks is what is weighing down the markets," said Rakpong Chaisuparakul, a strategist with KGI Securities (Thailand).
Singapore shares fell as much as 0.5%, heading for their first decline in four sessions, dragged down by financials and industrials. DBS Group dropped as much as 1.3%, while Jardine Matheson Holdings Ltd fell up to 1.2%.
Malaysian shares were largely unchanged with consumer cyclicals, healthcare and energy stocks weighing on the index. Genting Malaysia Bhd dropped as much as 3.1%, while gas infrastructure and utilities company Petronas Gas Bhd hit a one-week low.
Indonesian shares resumed trading following a holiday and were slightly higher after three consecutive sessions of falls. Telecoms and consumer staples were among the leading gainers.
Vietnamese shares inched up, buoyed by financials and industrials, though gains were capped by losses in energy stocks. "I think we have priced in a lot. Our prime minister is going to the United States next week to meet with President (Donald) Trump; that's something that the market is in part looking forward to but also nervous about," said Fiachra Mac Cana, head of research at Ho Chi Minh Securities.
Trump will host Vietnamese Prime Minister Nguyen Xuan Phuc at the White House on May 31 to discuss bilateral relations and regional cooperation.