Capital markets in the region experienced another weak month in October, following a lacklustre September. Uncertainties from the US presidential election, protracted US fiscal stimulus talks and a resurgence in infection numbers in Europe contributed to the bearish sentiment.

Closer to home, Thailand’s stocks fell on mounting anti-government protests, which if protracted are likely to derail an economic recovery – its key equities benchmark tumbled to the lowest level in more than six months. The GPR/APREA total return gauges for the kingdom’s listed real estate and REITs contracted by double digits to clock the biggest fall among regional markets.

The GPR/APREA Listed Real Estate Composite Index posted negative returns in October, underperforming the region’s equities market, which were supported by stocks in the heavily-weighted tech sector, as well as bonds. China’s property stocks, a regional heavyweight, contracted as property firms continued to face mounting pressure to meet the government’s new debt-ratio caps. Stocks in Indonesia, however, bucked the regional trend to clock the largest gains on optimism that labour market reforms could bolster growth. Sentiment in the Philippines also revived in the wake of slowing infection cases.

REITs

Total returns for Asia-Pacific REITs similarly contracted in October. Taiwan and China-linked REITs were the only markets that stayed in positive territory. Sector indices were negative across the board with retail the hardest-hit, while industrial REITs contracted the least.

During the month, the CapitaLand Commercial Trust and CapitaLand Mall Trust merger was finalised to form a new entity – CapitaLand Integrated Commercial Trust.