Thai stocks hit 10-week high amid regional rise on vaccine hopes
published : 19 May 2020 at 17:46
Southeast Asian stock markets gained on Tuesday, with Thailand hitting its highest level in more than two months, as investors cheered positive data from an early-stage study testing a coronavirus vaccine. Southeast Asian stock markets gained on Tuesday, with Thailand hitting its highest level in more than two months, as investors cheered positive data from an early-stage study testing a coronavirus vaccine.
Asian equities tracked Wall Street's rally on Monday after drugmaker Moderna Inc's experimental Covid-19 vaccine appeared safe and showed promise in a small group of healthy volunteers, according to very early data.
"The peak-virus trade continues to gather momentum after last night's Moderna headlines," said Jeffrey Halley, senior market analyst at OANDA. "Moderna's trial is terrific news, but the sample size was not statistically significant... Thus, in the best-case scenario, it will probably be another year before normal life will make a comeback, at best."
Leading gains in the region, Thai shares rose 1.8% to close at their highest level since March 6, lifted by industrial and energy stocks. Thai Airways International surged 14.6% and boosted the index after the cabinet approved a court-led restructuring of the troubled national carrier.
Indonesian shares, which rose as much as 2.2% in the session, closed 0.8% higher after the central bank kept its policy rate steady against expectations for a cut. Interest rate-sensitive bank stocks rose on the news, with Bank Tabungan Pensiunan Nasional Syariah PT jumping 8.1% and PT Bank Rakyat Indonesia (Persero) surging 9.2%.
However, Bank Indonesia (BI) pledged to maintain ample cash in the financial system and said there was room to cut rates in the future to cushion Southeast Asia's biggest economy. "With BI retaining its accommodative stance we continue to expect more rate cuts in the coming months given expectations for a contraction in GDP as early as the 2Q," ING Economist Nicholas Mapa wrote in a note.
Singapore shares extended gains into a third session, buoyed by financial and consumer service stocks.
Malaysian stocks rose 1%, closing at its highest level since April 20, after the world's biggest edible oil importer India resumed purchases of Malaysian palm oil after a four-month gap following a diplomatic row. Petronas Chemicals Group climbed 5%, while palm oil and rubber plantation company Kuala Lumpur Kepong Bhd rose 3.5%. For
Asian markets were likely to be the first to recover, said William Haandrikman, general manager of the Sofitel Legend Metropole Hanoi, an iconic, colonial-era hotel whose crowds of wealthy Western tourists are long gone.
"We have had to re-invent ourselves to focus directly on the local domestic market as well as regional Asian markets," he said. That includes room deals with $100 credits for food.
Domestic tourism is now on the rise, with most Vietnamese airlines reporting their limited domestic flights are fast reaching capacity.
Lured by low prices, Le Thi Mai Phuong, a 38-year-old businesswoman from Hanoi, spent last weekend in the central city of Danang.
"I'm afraid that if we wait until the virus is over, the cost will go up and the beaches will become too crowded," she said. "We don't know if the virus will return to Vietnam and cause another lockdown".
"I'd have to stay at home and dream about travelling again."