KUALA LUMPUR (Nikkei Markets) -- Singapore shares rose for the first time in three sessions on Monday, as strong economic data from China and South Korea over the weekend offset concerns about the heightened risk of a conflict between the U.S. and North Korea. Malaysia stocks fell to their lowest level in 11 weeks.
Official confirmation that private home prices in Singapore rebounded in the third quarter after declining for 15 straight quarters also buoyed confidence in banks and developers, which were among the day's top gainers.
"The news should bring more cheers to the market which has already been rejoicing in the buoyant primary home sales market, billion-dollar land bids by developers, and increasing momentum on the private sale of projects for redevelopment," analyst Tan Kok Keong wrote in a report on Smartkarma, an investment research platform. "The Singapore economy has also shown signs of revival. Collectively, these points to a sustained recovery in residential property prices from here on."
The city-state's benchmark Straits Times Index gained 1.31% to 3,262.10.
DBS Group Holdings, Southeast Asia's largest lender, added 2.1% to close at S$21.24, while Oversea-Chinese Banking Corp. and United Overseas Bank rose 0.9% and 2.13% to S$11.26 and S$24, respectively. The three banks account for nearly 30% of the benchmark index.
Singapore Telecommunications rose 0.54% to S$3.7. DBS Equity Research reiterated its "buy" recommendation on Singtel on Monday, saying the company was trading at a 20%-40% valuation discount versus its peers and could pay a special dividend following the sale of its NetLink Trust unit via an initial public offering in July this year.
On Saturday, China released its official Purchasing Managers' Index that showed manufacturing activity rose in September to its highest level in more than five years. South Korea, meanwhile, said on Sunday its exports jumped a hefty 35% in September from a year earlier, exceeding analysts' estimates.
The FTSE Bursa Malaysia KLCI lost 0.1% to close at 1,754.78, the lowest level since July 13 and marking its tenth straight day of decline. State-owned Telekom Malaysia led declines with a 3.1% loss.
Net foreign fund outflows from Malaysia's equity market more than doubled last week to 967.3 million ringgit ($229 million) from 477 million ringgit a week earlier, as global investors adjusted their portfolios to make room for higher-yielding U.S. Treasuries after the Federal Reserve signaled a rate increase in December.
"Local investors have retreated as there is not enough liquidity to sustain the market levels in the face of foreign selling," said Pong Teng Siew, head of research at Inter-Pacific Securities. "While the institutions may step in to try and support the market at key levels, they are not going to jump in and let the foreign funds easily exit with a profit."
Lotte Chemical Titan Holding, the Malaysian unit of South Korea's Lotte Chemical, dropped 5.3% after the government asked the company to stop work on a project at its so-called TE3 site. While Lotte said the project is on track for completion in the fourth quarter of this year, investor sentiment is likely to be affected because of the development, said Kylie Chan, an analyst at TA Securities.
Star Media Group, the publisher of Malaysia's most circulated English newspaper, fell 1.2% to 1.69 ringgit. CIMB Investment Bank cut the stock's target price to 1.70 ringgit from 1.95 ringgit.
Malaysian oil and gas services firm Dayang Petroleum fell 6.1%, its steepest one-day loss this year. MIDF Amanah Investment Bank advised investors to take profit on the stock, which had risen on reports of new contracts.
Pantech Group Holdings rose 2.22% to 0.69 ringgit, near a three-year high, on hopes of more orders. The company won a contract worth around 100 million ringgit for Petronas' Refinery and Petrochemical Integrated Development, raising expectations for more oil-and-gas-related orders, JF Apex Securities' analyst Lee Cherng Wee said.
Retailer Parkson Holdings gained 1.6% to 0.65 ringgit as investors bet the company would return to profits in 2018 fiscal year due to cost reductions and better performance of its shopping malls in China.
--Alexander Winifred and Kevin Lim