BANGKOK (UPDATE) - Philippine shares suffered their worst loss in more than two months on Thursday, catching up with broad declines in Southeast Asia after a three-day break, while stocks in Thailand and other markets in the region trimmed some losses amid bargain hunting.
The benchmark Philippine composite index finished down 6 percent after an early drop of 7.4 percent.
Sell-offs in large caps such as Ayala Land Inc and SM Investment Corp sent the index to a two-month closing low of 6,136.73 and halved the gain this year in one of Asia's outperformers.
Investors remained hopeful of Philippine economic outperformance, including the second quarter GDP data due on Aug. 29 that could provide a cushion for the market as macroeconomic concerns clouded Southeast Asian region.
The central bank data released after market close showed the country's balance of payments (BOP) hit a six-month high in July, an indication of its strong fundamentals.
Stocks in Malaysia ended down 1.4 percent after falling as much as 2 percent, as Malaysia reported a slump in current account surplus and cut its economic growth forecast for the year.
Thai stocks pared most of their early loss, ending down 0.3 percent, as players bought battered big caps such as PTT and PTT Exploration and Production.
Thai bourse said foreign investors sold shares worth $113 million on Thursday, taking their net selling this week to $767 million, amid capital outflows from emerging markets.
Outflows hit across Thai assets, including Thai bonds, with seven-year bond yields rising by 15 basis points to 3.99 percent and 10-year bond yields jumping 26 basis points to 4.26 percent.
"It's the same direction as seen in the region. Foreign investors have adjusted their portfolios, selling from emerging markets and going back to developed markets," said Chinrath Sungkakhun, a fund manager with Finansa Asset Management.
Foreigners sold a net 94.6 billion baht ($2.97 billion) of Thai debt in May-June, but they have still been net buyers of 63.4 billion in the first half of 2013, according to the Thai Bond Market Association.
Stocks in Indonesia closed down 1.1 percent after a 2.6 percent drop in morning trade and Singapore eased 0.6 percent, falling almost 2 percent at one point.
Minutes from the U.S. Federal Reserve's policy meeting in July reinforced the outlook for a near-term cut in stimulus, further denting broader Asia.