JAKARTA (Reuters): Shares in emerging Asia edged slightly higher on Friday, as holidays in most markets and wary investors taking a cautious approach to tariff negotiations curbed trading.
Most benchmark gauges were on track to end the week in positive territory, recuperating from extreme shocks that jolted financial markets after US President Donald Trump unveiled sweeping tariffs on major trading partners two weeks ago.
The market remains on tenterhooks given the uncertainty around Trump's wavering policies, the economic fallout from an upending of the global trade order, and anxiety around how negotiations proceed, especially with China.
"Global risk appetite may be dampened for longer notwithstanding a pause in U.S.-China tariff escalation," Citi analysts said.
"We find the U.S. and China are hit hardest initially, but collateral damage is spread across Vietnam, Mexico, Korea and Asean."
An MSCI index of stocks in Asian emerging markets ticked higher, largely buoyed by South Korean and Taiwanese equities.
It held steady near a one-week high scaled on Tuesday. The index was on track to finish the week about 2% higher, after three weekly losses during which it shed 8%.
South Korea's KOSPI index added 0.4%, while Taiwan's benchmark consolidated after a two-session slump.
A gauge of Asean equities, mostly comprising Southeast Asian firms, edged higher for an eighth straight session.
Thailand's benchmark stock index ticked up while its currency, the baht, drifted lower after touching a near six-month high earlier in the week.
A shimmering rally in gold prices during the week kept the unit propped up. Malaysian shares jumped 0.8% to a two-week high, lifted by a broad-based rally in blue-chip stocks led by banks.
An advance estimate showed the country's economy slowed down in the first quarter of 2025 compared to the prior quarter.
On Thursday, JP Morgan turned neutral across Asean countries except Thailand and Singapore, citing growing macro headwinds and a fiscal support that is likely to be inadequate.
It also upgraded consumer staples to overweight and real estate to neutral while downgrading industrials and financials to neutral.
"We are prioritizing safety over potentially higher returns until clarity emerges - preference for cash, defensives, domestic exposures, and strong idiosyncratic earnings momentum," JP Morgan analysts said.
Singapore's dollar drifted away from its late October highs scaled on Wednesday, while Malaysia's ringgit and Thailand's baht were mostly unchanged.
Financial markets in Singapore, Indonesia, the Philippines, and India were closed for the Good Friday holiday. - Reuters
