Singapore stocks rose more than 1% on Thursday, ending a five-day slide as lender DBS hit an all-time high after posting a record second-quarter profit, while most other emerging Asian equities retreated.
The MSCI EM Asia equity index dipped almost 2%, dragged mainly by heavyweight chipmakers in South Korea and Taiwan, which account for more than a third of the index.
A gauge tracking ASEAN equities, dominated by the banks in Singapore, added 0.7% to hit a near six-month peak.
Singapore's benchmark equity index advanced 1.1% in its best session in a week. DBS Group, Southeast Asia's top bank by assets, jumped 3% to a lifetime high after raising its full-year outlook and reporting a record quarterly profit.
Smaller rivals Oversea-Chinese Banking Corp and United Overseas Bank 2.2% and 1.4%, respectively.
Elsewhere in Southeast Asia, Indonesia's equity gauge drifted sideways in a tight range around its two-week high, while Thai stocks added 0.7%.
Equities in the region have attracted investor interest recently following a sell-off in AI and chip-related stocks in South Korea and Taiwan, prompting investors to cut their exposure following an unprecedented rally earlier in the year.
The MSCI ASEAN index has gained 8% since June-end, outperforming broader EM Asia, which is down about 4%, led by Indonesia's 13% rise.
"When we look at Singapore and Indonesia specifically, both countries carry less of the semiconductor and AI-linked exposure that's largely been responsible for the rally we have seen this year," said Zavier Wong, a market analyst at eToro.
Investors seeking profits without leaving the region are naturally rotating into the two markets, he added.
In South Korea, the benchmark KOSPI declined as much as 5.5%, weighed by losses in chip majors Samsung Electronics and SK Hynix, both down as much as 6.7% and 9.8%, respectively.
Taiwan's stocks also lost as much as 1.3%, with semiconductor leader TSMC falling 1.9%.
Among currencies, the South Korean won strengthened to as much as 1,414.5 per U.S. dollar, the strongest since early October 2025. Taiwan's dollar also appreciated to a three-week high of 32.20 a dollar.
The Philippine peso inched higher to a seven-week peak of 60.634 per U.S. dollar, while Indonesia's rupiah and Malaysia's ringgit inched higher.
Meanwhile, Indonesian President Prabowo Subianto will move quickly to appoint a new central bank governor, and interim head Destry Damayanti is the frontrunner for the role, a source with knowledge of the matter told Reuters.
Investors are watching the nomination process amid concerns over Bank Indonesia's independence and pressure to support Prabowo's 8% growth target from around 5% now.
HIGHLIGHTS:
** Indonesia's 10-year benchmark bond yields at 7.270%
** Fitch says Vietnam banks likely to face significant pressure from government growth target
** Singapore says exports worth $7.4 billion affected by new U.S. tariffs
** Indonesia to extend $11.2 billion government placement in state banks, minister says - Reuters
