*
Thai baht weakens on PM selection uncertainty
*
China industrial output, retail sales data missed
expectations
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Worries about U.S. debt ceiling weigh on markets
By Mehr Bedi May 16 (Reuters) - Thailand's currency and shares lost ground on Tuesday as investors remained uncertain whether opposition parties that won Sunday's election would overcome potential challenges to them forming a coalition government. Other Asian currencies remained subdued.
The baht depreciated as much as 0.4% against the dollar while equities in the tourism-reliant economy fell about 0.2% to a week's low. The Move Forward party said on Monday that it had sufficient votes to form a coalition government but a military-appointed Senate, the party's position on a royal insult law and a complaint against its leader may stand in the way. The six opposition parties in the proposed coalition commanded 309 seats in the 500-seat lower house of parliament, well short of the 376 seats needed to ensure the election of Move Forward's leader, Pita Limjareonrat, as prime minister. "In the near term, the baht will be under pressure from political uncertainty regarding the formation of the government," said Poon Panichpibool, markets strategist at Krung Thai Bank, adding that he expects the currency to move sideways for no more than two months.
Elsewhere in the region, China's April industrial output and retail sales growth undershot forecasts, suggesting that Asia's largest economy lost further momentum at the start of the second quarter, putting more pressure on policymakers to shore up a wobbly post-COVID recovery. Analysts at OCBC research said the data provided "evidence that the China reopening story is losing its appeal and markets may be growing impatient." The Hong Kong benchmark index slipped 0.4%. The Shanghai SE Composite Index remained largely flat, while the yuan depreciated 0.1%. Despite weaker-than-expected Chinese economic data and investors being wary of the crucial U.S. government debt-ceiling negotiations, most stock markets in Asia held firm.
The Indonesian rupiah and Malaysian ringgit weakened 0.1% while Taiwanese dollar and South Korean won appreciated marginally.
Share markets in Philippines and Taiwan gained over 1% each while stocks in Kuala Lumpur rose 0.5%.
HIGHLIGHTS:
** Philippine c.bank to hold rates at 6.25% in May after
nine straight increases, according to a Reuters poll
** India's April merchandise and services trade deficit at
21-month low
** Long-standing President Tayyip Erdogan took a commanding
position in Turkey's elections COUNTRY FX RIC FX FX INDE STOCKS STOCKS
DAILY % YTD % X DAILY YTD %
%
Japan +0.11 -3.57 <.N2 0.79 14.49
25>
China <CNY=CFXS -0.10 -0.85 <.SS 0.01 7.18
> EC>
India +0.16 +0.68 <.NS 0.01 1.63
EI>
Indonesi -0.07 +5.13 <.JK -0.52 -2.53
a SE>
Malaysia -0.07 -2.18 <.KL 0.52 -4.73
SE>
Philippi -0.16 -0.75 <.PS 1.09 0.42
nes I>
S.Korea <KRW=KFTC +0.05 -5.37 <.KS 0.12 10.99
> 11>
Singapor +0.04 +0.32 <.ST -0.05 -1.18
e I>
Taiwan +0.07 -0.27 <.TW 1.40 10.99
II>
Thailand -0.38 +2.08 <.SE -0.21 -7.82
TI>
(Reporting by Mehr Bedi in Bengaluru; Editing by Simon Cameron-Moore)
