Emerging Asian equity markets traded mixed on Thursday, while currencies held steady as market participants digested less-hawkish-than-feared comments from U.S. Federal Reserve Chair Jerome Powell after a widely expected interest rate cut.
The broader MSCI index of emerging Asia equities was down 0.7% and an index tracking Asian equities outside Japan was 0.5% lower, hurt by South Korean and Taiwanese stocks, after cloud computing giant Oracle sounded a warning for AI profitability.
The U.S. cloud computing giant's disappointing earnings added to fears of overvaluation in the AI sector, triggering a pullback in tech-heavy Asian indexes such as South Korea and Taiwan.
Stocks in Jakarta climbed as much as 0.9% to hit a record high before reversing gains, while equities in Singapore and Kuala Lumpur rose 0.3% each.
Among currencies in the region, Malaysia's ringgit rose 0.3% after three straight sessions of losses, while the Singapore dollar was marginally lower against a weaker U.S. dollar.
The greenback was on the back foot after the Fed's 25-basis-point rate cut and Powell's comments at his post-meeting press conference were perceived as less hawkish than expected, firming bets of two more rate cuts next year.
Steven Dooley, head of market insights at Convera, said rising odds of a rate cut in early 2026 would boost global liquidity and help emerging Asian assets "play catch-up".
Elsewhere, the Philippine peso slipped, while stocks rose 0.4% ahead of the Bangko Sentral ng Pilipinas' (BSP) rate decision later in the day.
A Reuters poll showed economists expected the central bank to deliver a 25-bp rate cut, citing weak growth and easing inflation, with at least one more reduction seen early next year.
Stocks in Thailand were down 1.2% as trading resumed after a holiday on Wednesday, while the baht eased 0.1%.
Fighting between Thailand and Cambodia entered its fourth day as both sides waited for a promised telephone call from U.S. President Donald Trump.
HIGHLIGHTS:
** US bombers join Japanese jets in show of force after China-Russia drills, Tokyo says
** Mexico's Senate passes tariff hikes on Chinese, other Asian imports
** Hong Kong central bank cuts interest rate, tracking Fed move
** ADB approves $500 mln loan to support a sustainable Philippine blue economy - Reuters
