JAKARTA May 10 (Reuters): Asian stock markets were broadly lower on Tuesday, tracking a sell-off overnight on Wall Street on concerns that the US Federal Reserve's planned rate hikes will hamper the economy's growth prospects, while currency markets saw some gains.
Stocks in Indonesia plunged the most in the region, falling 2.9%, while shares in the Philippines dropped 1.4% following the unofficial result of its presidential election.
Ferdinand Marcos Jr, the son and namesake of a dictator who was ousted in 1986 in a "people power" uprising, is projected to have a landslide victory over his rival, the Philippines' incumbent Vice President Leni Robredo.
ING analyst Nicholas Mapa said the stocks drop might be in part a reflection of a survey saying Marcos is the candidate less-favoured by the investor community.
"Among other campaign promises, Marcos has vowed to subsidise food and fuel items, which will adversely affect the country's fiscal sustainability goals," analysts at ING also said.
Singapore stocks lost 1.3%, while shares in South Korea slid 0.7% amid pessimism over higher interest rates hampering the global economic outlook as one of Wall Street's three main indices breaching a key support level overnight.
Emerging Asian currencies, however, turned positive, with the Philippine peso gaining 0.4%, its steepest climb in over a month as clear signals on the likely election outcome emerged.
"Some uncertainty is taken out ... from a currency perspective, a little bit more clarity, and clarity normally for a currency is supportive," said Dominic Schnider, Head of commodities and APAC Forex at UBS Wealth Management (HK).
Other Asian currencies, which have been under selling pressure over the last two sessions due to the cloudy global economic outlook, clawed back some gains, possibly supported by a higher currency and stock market in China, the region's top economy.
China's yuan gained 0.4%, while its stock market also gained 0.2%.
Some broad dollar weakness might also be aiding currency markets in Asia, ING analyst Mapa added.
The US dollar index lost some steam to be down 0.1% after a Fed official said a 75 basis point hike by the central bank was unlikely, further supporting emerging currencies. In Malaysia, data showed industrial production in March rose more than markets had expected.
The ringgit and local stock index rose about 0.1% each. - Reuters
