Southeast Asian stocks tracked global peers lower on Monday as investors fretted over the impact of US-China trade spat, while caution ahead of corporate results and uncertainty over a clean Brexit kept risk appetite subdued.
Over the weekend, China central bank governor Yi Gang said he still saw plenty of room for adjustment in interest rates and the reserve requirement ratio, as downside risks from trade tensions with the United States remained significant.
MSCI's broadest index of Asia-Pacific shares outside Japan fell 1% while Shanghai shares were down 0.75%, with investors bracing for a European Union summit from Wednesday amid concerns over Brexit.
Manny Cruz, an analyst at Asiasec Equities Inc, said regional markets fell due to weakness in broader Asia amid fears that some US companies may post lower-than-expected earnings.
"The Brexit deal is also hanging in the balance and is causing anxiety," he added.
Although stocks in the region recovered on Friday, partly after Chinese trade data showed strong growth in September, investors turned cautious on Monday as a bounceback in oil prices and rising tensions between Western powers and Saudi Arabia added to a confluence of factors that battered global equities last week.
"With China's GDP data expected later this week, people are just waiting on the sidelines," said Joel Ng, an analyst with KGI Securities.
Gang said on Sunday China's economic growth would comfortably reach its full-year target of around 6.5% with the possibility of overshooting. The GDP data is expected on Friday.
After see-sawing during the day, Indonesian shares settled 0.5% lower. The country's trade balance unexpectedly swung back to surplus in September as imports and exports grew much slower than expected, data released by the statistics bureau showed on Monday.
Philippine shares ended the session 1.1% lower, hurt by industrial and consumer stocks. Conglomerates SM Investments and Universal Robina Corp were the biggest drags on the benchmark.
The Vietnamese index ended 1.9% lower while Singapore shares shed nearly 0.8%.