- Moody's lowers Indonesia credit rating outlook
- JKSE slides 3%; rupiah slips
- South Korea's KOSPI down 1.4%
- Thailand election, Japan snap vote on February 8
Feb 6 (Reuters) - South Korean shares ended lower on Friday as investors continued to retreat from technology stocks, while Indonesian equities fell 3% after Moody's cut the country’s credit outlook, adding pressure on Southeast Asia’s largest economy.
The MSCI index of emerging Asian equities slipped 0.6% and was set for its worst week since Nov. 21 with a 2.1% loss. The regional IT gauge has fallen nearly 3% this week, its steepest drop since mid-December.
South Korea's KOSPI index fell 1.4%, ending the week 2.6% down after snapping a six-week winning streak with chipmakers Samsung Electronics and SK Hynix falling 0.4% each on Friday.
Markets were jolted this week after AI firm Anthropic unveiled a new legal tool for its Claude chatbot, raising worries over broader disruption to the information technology and software services sector.
"With U.S. tech wobbling, sentiments tend to trickle over to Asian tech as well, particularly after a strong run that left positioning looking stretched," said Zavier Wong, market analyst at eToro.
"What we're seeing now feels more like investors de-risking and locking in gains rather than a sign that the broader tech theme is breaking down."
In Southeast Asia, Indonesia's Jakarta Composite Index dropped as much as 3% and the rupiah weakened to 16,888 per U.S. dollar, its lowest point since January 22. The benchmark was set to close the week down more than 5%, extending last week's near 7% slide.
Investor confidence in Indonesia has weakened due to growing concerns around policy uncertainty under President Prabowo Subianto, including a widening fiscal deficit and central bank independence.
Foreign investors pulled $1 billion from equities in 2025, according to exchange data. Outflows have accelerated since mid-last week after MSCI warned of a potential downgrade to frontier-market status and Moody's downgraded the country's credit rating outlook on Thursday.
"In the near-term, onshore financial markets are likely to witness knee-jerk weakness due to the outlook change, with much onus on the domestic policy response thereafter," DBS analysts wrote.
"An outlook change doesn't carry immediate changes in rating-sensitive investment mandates, although there might be lower appetite to build additional exposure, besides a higher preference for shorter-tenor papers."
Stocks in Malaysia, the Philippines and Taiwan were largely unchanged, while Singapore shares dropped 0.8% and Thailand's SET Index rose 0.5%.
Among currencies, the South Korean won hovered around 1,470.60 a dollar, its weakest level in more than two weeks before paring losses, while the Thai baht appreciated around 0.3%.
Thailand is set to hold a general election on Sunday, the same day Japan votes in a snap election called by Prime Minister Sanae Takaichi.
HIGHLIGHTS:
** Yield on Indonesia's 10-year benchmark bonds at 6.317%
** Malaysia could raise 2026 economic outlook, AI boom to drive exports, officials say
** Singapore budget may be less generous amid resilient growth
** Thai PM Anutin's gamble on nationalism to be tested in close election
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Asia stock indexes and currencies at 0716 GMT |
||||||
|
COUNTRY |
FX RIC |
FX DAILY % |
FX YTD % |
INDEX |
STOCKS DAILY % |
STOCKS YTD % |
|
Japan |
+0.20 |
-0.04 |
(.N225) |
0.27 |
7.78 |
|
|
China |
-0.05 |
+0.70 |
(.SSEC) |
-0.25 |
2.44 |
|
|
India |
-0.12 |
-0.66 |
(.NSEI) |
-0.33 |
-2.19 |
|
|
Indonesia |
-0.30 |
-1.21 |
(.JKSE) |
-2.51 |
-8.63 |
|
|
Malaysia |
-0.13 |
+2.71 |
(.KLSE) |
-0.08 |
2.94 |
|
|
Philippines |
+0.38 |
+0.42 |
(.PSI) |
0.14 |
5.58 |
|
|
S.Korea |
-0.12 |
-1.77 |
(.KS11) |
-1.44 |
20.76 |
|
|
Singapore |
+0.13 |
+0.95 |
(.STI) |
-0.77 |
6.27 |
|
|
Taiwan |
-0.13 |
-0.80 |
(.TWII) |
-0.06 |
9.73 |
|
|
Thailand |
+0.33 |
-0.74 |
(.SETI) |
0.50 |
7.40 |
Reporting by Sneha Kumar and Roshan Thomas in Bengaluru; Editing by Sherry Jacob-Phillips
Source: Reuters