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Economy

Singapore, Malaysia stocks fall after Trump's tax plan

SINGAPORE (Nikkei Markets) -- Singapore and Malaysia shares edged lower as U.S. President Donald Trump's much-awaited plan for tax reforms lacked details, disappointing investors.

U.S. stocks edged lower overnight after Trump proposed to cut corporate tax rates to 15% from the current 35%, but did not offer specifics as to how he plans to fund the reductions. Traders also said the market had already priced in the news, and that led to the muted reaction.

"For a market that had rallied since Trump's victory in the November election, the scant details meant little fresh insights," said Jingyi Pan, a market strategist at IG, a brokerage. "Details on how the tax plan can achieve revenue-neutrality and clear the Congress remain to be seen."

Singapore's FTSE Straits Times index fell 0.1% to 3,171.36. United Overseas Bank was among the top losers, dropping 1.1% ahead of its earnings on Friday. DBS Group Holdings dipped 0.5%. Yangzijiang Shipbuilding Holdings rose 1.3% and Global Logistic Properties added 0.7%. The stocks were among the day's best performers.

The city-state's central bank in its half yearly macro-economic review said the "outlook for the Singapore economy has improved slightly, but GDP growth is expected to remain modest and uneven across different sectors." The bank earlier this month had kept its exchange rate- based monetary policy unchanged and reiterated its forecast of 1% to 3% GDP growth for 2017.

M1 rose 3.8%. Chinese coal producer Shanxi Meijin Energy and China Broadband are among the bidders for the telecom operator, Bloomberg reported, citing people with knowledge of the matter. Non-binding bids have also been made by Bahrain Telecommunications and private equity funds, according to the report.

Singapore Technologies Engineering was unchanged at S$3.8. Late Wednesday, the company said its land systems arm, Singapore Technologies Kinetics, had injected 17.1 million Canadian dollars (S$18 million) into Kinetics Drive Solutions through Mobility Systems.

The FTSE Bursa Malaysia KLCI declined less than 0.1% to 1,767.92, snapping a four-day winning streak. Genting Malaysia, up over 10% this month through Wednesday over optimism on its expansion of Genting Integrated Tourism Plan, slipped 3.2% to lead losses on the 30-stock gauge.

Westports Holdings was little changed at 4.04 ringgit after falling 1% earlier as its net profit for the first quarter fell 17.6% on year with high fuel costs weighing on earnings. It also adjusted for a one-off gain that had boosted profit in the corresponding quarter last year.

Maxis rose 0.2% after revenue inched up 0.8% despite intense price competition. The company's profit for the first quarter fell 2.5%.

British American Tobacco Malaysia slipped 2.2% amid concerns over falling revenues and profit.

The KLCI is up 1.6% this month, on course for its fifth straight monthly advance and hovering close to its highest level in almost two-years amid hopes of a pick-up in growth.

Malaysia's first-quarter economic growth appears to be tracking at 5% on year against 4.5% in fourth quarter, Nomura said in note to investors.

--Nimesh Vora and Kevin Lim

--Nikkei Markets is a real-time financial news service for South East Asia's markets published by Nikkei NewsRise Asia Pte Ltd, a Nikkei and NewsRise joint venture company. Nikkei Markets provides wide companies coverage in the region, including the Nikkei's Asia300 companies.

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