LONDON: Equities in emerging Asian markets fell on Friday, with some heading towards their worst month in more than two years as the looming threat of U.S. tariffs under a Trump presidency eroded the attractiveness of Asian assets.
Shares in South Korea declined 1.4 per cent, while equities in Singapore retreated 0.5 per cent.
Equities in Indonesia declined 6.1 per cent for November, heading for their worst month since September 2020.
Philippine stocks retreated 6.7 per cent for November, in what could be their biggest monthly fall since September 2022.
There is a scarcity of growth in Indonesia that is creating uncertainty among investors, who worry over domestic consumption growth that is still below 5 per cent, said Fakhrul Fulvian, an economist at Trimegah Securities.
The Indonesia rupiah edged 0.1 per cent higher a day after candidates backed by new Indonesian President Prabowo Subianto looked set to secure victories in key regional elections, with the exception of Jakarta.
"We stay cautious on the pair given the uncertainties, although we do not rule out that it can eventually come off," analysts at Maybank said referring to the dollar-rupiah pair.
The Thai baht and the Malaysian ringgit rose 0.4 per cent and 0.2 per cent, respectively.
The ringgit and the baht were heading both for their second month of consecutive declines.
President-elect Donald Trump has said he would immediately put a 25 per cent tariff on all products from Mexico and Canada when he takes office in January, and impose an additional 10 per cent tariff on goods from China, a major trading partner for Asian economies.
The prospects for a trade war "pointed to more headwinds on Asian currencies in 2025, while we look for more two-way volatilities in Asian FX as the actual tariff hikes could come lower than expected, considering the reflation risk in the U.S.," said Ken Cheung, Chief Asia FX Strategist at Mizuho Bank.
The South Korean won is among the worst hit with the currency losing 7.8 per cent so far this year.
The country's economy is exposed to both the U.S. and Chinese markets.
The Bank of Korea (BOK) unexpectedly lowered benchmark interest rates for its second consecutive meeting on Thursday as economic growth faltered and policymakers turned a wary eye to the trade risks from a second Trump presidency.
"The BoK fast rate cut suggested more rate cuts to come sooner before USD regains momentum," Cheung said.
Equities in South Korea were set for their worst month since January.
Elsewhere, Brazil's real hit a lifetime low on Thursday after the government's proposed income tax reform sparked a bruising selloff, while the Mexican peso edged 0.1 per cent lower.
Investors are now awaiting a slew of economic data next week, including inflation data from Indonesia, South Korea, the Philippines, Taiwan and Thailand, as well as an interest rate decision from the Reserve Bank of India.