(March 14): Most Asian stock markets rebounded on Friday but were still set for steep weekly declines, as persistent tariff threats from US President Donald Trump intensified global trade tensions and led cautious investors to turn to safe haven assets.

Stocks in Thailand and Malaysia were up 1% and 0.2%, respectively, but were headed for declines of 2.6% and 2.5% for the week — with the Malaysian market eyeing its worst weekly performance since September 2022.

Philippine equities rose 0.7%. Taiwanese stocks were last largely flat, but were poised for their third straight week of losses, a run last seen seven months ago.

Rising global trade tensions have stirred market volatility and sapped risk appetite, driving investors towards safe haven assets such as US treasuries and gold, with the yellow metal reaching a record high.

Trump threatened on Wednesday to escalate a global trade war with further tariffs, as major US trading partners said they would retaliate in tit-for-tat measures.

"Reciprocal tariffs in particular are going to be quite hurtful," said Illiana Jain, an economist at Westpac.

"When you add reciprocal tariffs or try and pressure a lot of these Asian economies to drop tariffs that are there to protect domestic industries, we might see prices start to increase for some of the critical goods, and that's going to hamper growth as well as general sentiment within Asia."

Indonesia stocks fell 1.6% on Friday and were on track for a 1.4% weekly drop.

The Indonesian government maintained its budget deficit forecast at 2.53% of GDP this year despite a 30% plunge in tax revenues in the first two months of 2025.   

Regional currencies inched higher as the dollar steadied. The Philippine peso added 0.3%, and the Thai baht edged up 0.1%.

The Indonesian rupiah also added 0.3% to 16,375 against the dollar, but still lingered around the five-year low it slipped to last month. The rupiah is the worst performer in emerging Asia so far this year.

"In light of our expectations of a re-firming in the dollar bias this month and next quarter, rupiah is likely to stay offered," analysts at DBS said in a note.

Investors now wait for Bank Indonesia's interest rate decision next week.

Uploaded by Magessan Varatharaja