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EMERGING MARKETS-Asia's emerging currencies held lower by firmer dollar

    * U.S. 10-year bond yields climb to 1.7442%
    * Malaysian bonds to stay in FTSE Russell bond index
    * China bonds to be included in bond index from this year

    March 30 (Reuters) - Asia's emerging currencies buckled
under a firmer dollar on Tuesday after U.S. bond yields topped
1.7% again, with the Thai baht leading losses, falling nearly a
fifth of a percent. 
    Benchmark 10-year U.S. Treasuries climbed to
1.7442%, bolstering the greenback, which also garnered support
from worries of a hedge fund default that roiled global banking
stocks on Monday. 
    "There are still a number of investors who are concerned
about a further spike in UST," Morgan Stanley analysts said in a
note, adding that U.S. economic data surprises could push yields
higher. "Hence, these investors continue to position
defensively."
    Stocks in Jakarta led declines in Asia, falling more
than 1%. Yields on its benchmark 10-year bonds rose
8.4 basis points to 6.84%, with the rupiah slightly
lower. Bond yields fall when prices rise. 
    The yield on 10-year Malaysian bonds fell 4.3
basis points to 3.292%, after FTSE Russell removed the country
from its watchlist and officially retained it in its flagship
government bond index.
    "This is a much welcome relief, and will allow investors to
re-focus on other external drivers," HSBC said. 
    The ringgit, however, dipped 0.1% and stocks
were down a third of a percent.  
    FTSE Russell also confirmed that Chinese sovereign bonds
will be included in its bond index starting this year, setting
the stage for billions in inflows.
    HSBC said that with roughly $2.5 trillion tracking the FTSE
World Government Bond Index, some $130 billion in inflows could
be expected, given China's eventual 5.25% weighting. 
    In Thailand, shares rose 0.4% but gains were capped
by state-owned listed oil and gas firm PTT Pcl. 
    A key OPEC+ meeting this week will decide whether output
curbs should remain in place to support prices.
    Indian markets are set to reopen on Tuesday following a
market holiday. COVID-19 cases are rising fast in the world's
second most populous nation. 
    On the other end, South Korean shares rebounded as
institutional investors turned net buyers, while in Singapore
 shares rose 0.8% to their highest since February last
year. 
        
    HIGHLIGHTS: 
    ** Malaysia's AirAsia posts record quarterly loss; shares
fall
    ** Philippines raises $500 mln via discount Samurai bond -
IFR
    ** Top losers on the Jakarta stock index include Bank
Mayapada Internasional Tbk PT and Pollux Properti
Indonesia Tbk PT    
  Asia stock indexes and currencies at   0338 GMT
 COUNTRY      FX RIC      FX       FX     INDEX    STOCKS   STOCKS
                          DAILY %  YTD %           DAILY %  YTD %
 Japan                    -0.17    -6.12           -0.05    7.01
 China                    -0.03    -0.65           0.57     -0.52
 India                    +0.00    +0.77           0.00     3.76
 Indonesia                -0.07    -2.84           -1.28    1.82
 Malaysia                 -0.12    -2.99           -0.31    -1.28
 Philippines              -0.02    -0.89           -0.96    -8.34
 S.Korea                  -0.13    -4.15           1.22     6.95
 Singapore                +0.01    -1.98           0.77     12.53
 Taiwan                   +0.11    -0.13           -0.03    11.80
 Thailand                 -0.16    -4.01           0.35     9.67
 
 (Reporting by Nikhil Kurian Nainan in Bengaluru. Editing by
Gerry Doyle)
  
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