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CORRECTED-EMERGING MARKETS-Malaysian shares recover, ringgit steady as political tensions ease

 (Corrects Reuters Instrument Code for Malaysia stock exchange
in paragraph 4)
    * Graphic: World FX rates tmsnrt.rs/2egbfVh
    * Graphic: Foreign flows into Asian stocks tmsnrt.rs/3lKhL5I
    * Malaysian stocks up 0.6%, ringgit holds steady
    * Thai assets may be pressured in near term - Citi
    * Philippine stocks slide 1.7% after six-day winning streak

    By Rashmi Ashok
    Oct 27 (Reuters) - Malaysian shares rose on Tuesday as
political tensions eased after the largest party in the ruling
coalition declared its support for the prime minister, providing
some respite for the premier, who has faced calls to resign.
    Most other Asian stock indices were firmly in the red, as
soaring global coronavirus cases threatened to derail a quick
economic recovery, even as uncertainty ramped up with just days
left for the U.S. presidential election.
    The United Malays National Organisation (UMNO) party pledged
to back Prime Minister Muhyiddin Yassin, tempering the political
uncertainty stemming from calls for his resignation after the
king rejected his request for emergency rule on Sunday.

    The benchmark equity index rose 0.6%, while the
ringgit held steady at 4.163 against the dollar after
three sessions of losses.
     "The king's advice for members of parliament to not
continue with any irresponsible action that could undermine the
stability of the current administration could quiet political
noise in the near term," analysts at CGS CIMB wrote in a note.
     They added that averting an emergency decree was a
favourable outcome for equity markets but cautioned that it may
not be enough to reverse foreign investors from selling off
their holdings in the near term. 
    Thai markets edged lower as protests demanding
reforms of the powerful monarchy and calls for the prime
minister to resign continued undeterred.
    "The most contentious protesters' demand of reform to
monarchy has a very high hurdle and this may keep the protests
ongoing for now. This shall keep the overall sentiment around
domestic Thai assets and the baht weak," Citi analysts
noted.
    Philippine stocks slid as much as 1.7% and were set
for their biggest drop since August, as investors sold off
shares after a massive six-session run of gains of 10%.
    Asian currency markets bore a quiet look, with investors
shying away from big bets ahead of the U.S. election. The Taiwan
dollar was the sole exception, continuing its bullish
run and adding more than 1%.
     Analysts at Citi wrote that cautious risk appetite ahead of
U.S. elections may also cause further unwinding of bullish fast
money positioning in Asian FX, mainly in the yuan,
the South Korean won and the Singapore dollar.
    "But medium term prospects for Asia FX remain supportive, in
our view, with the dollar likely to weaken over the medium term,
stronger than expected recovery of the region and control over
the spread of COVID-19," the analysts added.
    
    
    HIGHLIGHTS
    ** In the Philippines, top index losers are LT Group Inc
 down 3.81% and BDO Unibank Inc down 2.99%
    ** Top gainers on FTSE Bursa Malaysia Kl Index
include Hartalega Holdings Bhd up 3.85% and Axiata
Group Bhd up 2.52% 
    ** Indonesian 10-year benchmark yields are up 0.8 basis
points at 6.62%​​ while 3-year benchmark yields are down 0.5
basis points at 5.224%​​ 
    
    
  Asia stock indexes and                               
 currencies at   0451 GMT                         
 COUNTRY  FX RIC       FX     FX    INDEX  STOCK  STOCK
                    DAILY  YTD %               S  S YTD
                        %                  DAILY      %
                                               %  
 Japan              +0.07  +3.68           -0.34  -1.02
 China    <CNY=CFX  +0.13  +3.88           -0.37   6.19
          S>                                      
 India              -0.04  -3.38            0.22  -3.08
 Indones            -0.14  -5.26           -0.12  -18.4
 ia                                                   4
 Malaysi            -0.02  -1.80            0.37  -5.58
 a                                                
 Philipp            -0.10  +4.63           -0.72  -17.5
 ines                                                 4
 S.Korea  <KRW=KFT  +0.04  +2.58           -0.54   6.08
          C>                                      
 Singapo            +0.20  -1.04           -0.65  -22.2
 re                                                   1
 Taiwan             +1.05  +5.26           -0.37   7.21
 Thailan            +0.06  -4.29           -0.46  -23.8
 d                                                    9
 

 (Reporting by Rashmi Ashok in Bengaluru. Editing by Gerry
Doyle)
  
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