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EMERGING MARKETS-Malaysia stocks rebound, fading dollar props up Asian currencies

    * Malaysia shares climb more than 1% 
    * State of emergency, lockdowns to be better implemented,
less
harmful on economy - analysts
    * Indonesia launches vaccination drive; shares rise

    Jan 13 (Reuters) - Malaysian shares rebounded on Wednesday
after two sessions in the red as investors looked past new
COVID-19 curbs in the country, while Asia's emerging currencies
regained footing as the dollar nursed losses.            
    Stocks in Taiwan, Thailand and Malaysia
 climbed more than 1%, while gains elsewhere in Asia were
more modest and Shanghai's Composite index dipped 0.4%.
China reported the biggest daily jump in COVID-19 cases in more
than five months with four cities in lockdown.
    Analysts reckon Malaysia's nationwide state of emergency
announced on Tuesday to combat rising infections cases may
improve the implementation of measures, while also reducing
political risks to a government facing a power struggle.

    "We think the impact of the current MCO (movement control
order) would be less severe than the initial phase last year
given that the containment measures should be less disruptive to
companies and households," economists at UOB said.
    Stocks in Kuala Lumpur nearly recovered all of the losses
over the last two sessions, while the ringgit has shed
around 1% this year to Tuesday.  
    Tee Sze Chiah, head of retail research at Maybank Investment
Bank, said the vaccine rollout and accommodative fiscal and
monetary policy would keep equities favourable despite the
"knee-jerk" reaction of the last two days.  
    Investors are hoping for a quick economic recovery in the
United States from a large fiscal stimulus and faster rollout of
coronavirus vaccines, boosting prospects for trade-reliant Asia.
    A pullback in U.S. Treasury yields sapped momentum from the
dollar's recent rally, supporting emerging currencies in Asia.
Indonesia's rupiah, favoured by foreign investors seeking
to tap the country's high-yielding debt, climbed 0.4%.
    Indonesia also kick-started its vaccination drive on
Wednesday, aiming to inoculate 181.5 million people. Shares in
Jakarta scaled to their highest since July 2019 in early
trading.
    Singapore shares hovered around 10-month highs, while
Bangkok equities touched nearly a year's high. 
    In Taiwan, the central bank has asked banks dealing in
foreign exchange to exercise restraint as it seeks to rein in
the soaring local dollar, sources told Reuters.
    
    HIGHLIGHTS:
    ** Indonesian 3-year benchmark yields are up 7.7 basis
points at 5.146%
    ** Banks in Malaysia rebounded, with Public Bank up 5.4% and
CIMB Group Holdings up nearly 3%        
 Asia stock indexes and currencies at 0644 GMT      
 COUNTRY      FX          FX       FX     INDEX    STOCKS   STOCKS
              RIC         DAILY %  YTD %           DAILY %  YTD %
 Japan                    +0.06    -0.43           1.04     3.69
 China                    +0.13    +1.14           -0.44    3.44
 India                    +0.15    -0.11           -0.05    4.11
 Indonesia                +0.43    -0.14           0.61     7.62
 Malaysia                 +0.36    -0.51           1.05     0.10
 Philippines              -0.17    -0.08           -0.21    1.44
 S.Korea                  +0.44    -0.81           0.71     9.56
 Singapore                +0.01    -0.15           0.33     5.04
 Taiwan                   +1.91    +1.92           1.74     7.04
 Thailand                 +0.47    -0.03           1.10     7.41
 
 (Reporting by Nikhil Kurian Nainan in Bengaluru; Editing by Sam
Holmes and Ramakrishnan M.)
  
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