Stock markets across major Southeast Asian countries rose on Tuesday as trading resumed after a long weekend, while South Korean equities pulled back from record highs following a sharp rally in recent sessions.
The Indonesian rupiah weakened to a lifetime low of 17,892 per dollar before recovering to trade flat. The currency remains under pressure from concerns over fiscal policy and governance, planned commodity export restrictions, and a widening current account strain fuelled by elevated energy prices, all of which have dampened foreign investor sentiment.
Singapore's FTSE Straits Times index climbed 0.5% to a one-week high, while Thailand's benchmark rose more than 1% to touch a three-year high, underpinned by strength in industrial stocks.
Indonesia's benchmark gauge jumped 1.5%, its biggest daily gain in seven weeks. Data showed annual inflation accelerated to 3.08% in May, exceeding market expectations and moving closer to the upper end of the central bank's target range.
Jakarta stocks and the rupiah continue to rank as the worst-performing assets in Asia, posting annual losses so far of around 28% and 7%, respectively.
"Market concerns remain valid in our view. The key issues still revolve around existing contracts, the risk of added bureaucracy, and the possibility of distorting normal market mechanisms," said Rully Arya Wisnubroto, chief economist at Mirae Asset Sekuritas Indonesia.
Markets in Malaysia will resume trading on Wednesday.
Elsewhere, South Korea's KOSPI fell more than 2%, pulling back from record highs after surging over 7% in the previous two sessions.
Taiwan's benchmark index was little changed. Both technology-heavy markets have benefited from sustained inflows into AI-linked stocks over the past year, with South Korea's KOSPI soaring 104% so far this year.
Investor enthusiasm for artificial intelligence has helped attract massive capital, helping offset concerns over higher energy prices that threaten to fuel inflation across many oil-importing economies.
"The positive impact of AI has offset the negative spillovers from the Strait of Hormuz for some Asian markets, in particular, South Korea and Taiwan, and to a smaller extent Singapore and Malaysia," said MUFG analyst Michael Wan.
The dollar index, which measures the currency against six peers, held steady at 99.165. The South Korean won further weakened to 1,517.7 per dollar to touch its lowest point since early April.
Consumer inflation quickened in May to a more than two-year high, beating expectations and bolstering the case for further monetary tightening.
The Indian rupee edged lower, last recorded at 95.15 and showing a decline of 5.6% for the year so far.
HIGHLIGHTS:
** U.S. President Donald Trump signs proclamation amending tariffs on steel, aluminium, and copper imports
** South Korean tech shares volatile as robotics stocks jump on Nvidia bet - Reuters
