EMERGING MARKETS-U.S.-China trade talks in focus as Malaysia dips

    * Graphic: World FX rates tmsnrt.rs/2egbfVh
    * Malaysian glove makers drag shares lower 
    * Chinese factory deflation boosts hopes of economic
recovery
    * South Korean stocks hit over 2-year high

    By Nikhil Nainan
    Aug 10 (Reuters) - Asia's emerging currency and stock
markets were mixed on Monday as some improvement in Chinese
factory data countered nervousness ahead of a round of trade
talks between Washington and Beijing at the end of the week.
    Malaysia's stock market was the biggest loser, down
nearly 1%, with the country's big protective glove makers
falling across the board. Analysts cited profit-taking after
strong gains due to the coronavirus pandemic.
    Trading was lighter than usual due to holidays in Japan and
Singapore and moves in the region's currencies, which have been
boosted over the past month by the broad weakness of the U.S.
dollar, were tight. Both Malaysia's ringgit and
Indonesia's rupiah eased around a quarter of a percent.
    "Asia Pacific markets are looking at a cautious day's
trading," said Michael McCarthy, a strategist at CMC Markets.
    "Ongoing concerns about Sino-U.S. relations, and the lack of
bi-partisan agreement on a U.S. fiscal support package, are
weighing on sentiment."
    Morgan Stanley in a week-ahead note said the upcoming trade
talks between the United States and China this weekend would be
the main risk event for emerging markets. 
    Chinese shares, however, edged higher as factory
deflation slowed in July and industrial activity climbed back
towards pre-COVID-19 levels.
    The Chinese data helped send trade-sensitive South Korean
stocks to a more than two-year high, led by a near 13%
jump in Hyundai Motor shares.
        
    HIGHLIGHTS
    ** Top Malaysian glove makers Top Glove Corp and
Hartalega Holdings fall 2.6% and 3.3%, respectively
    ** Hartalega and Top Glove shares nearly doubled in July
from June; Brokerage CGS-CIMB said the weightage of both
companies on the index has grown
    ** Indonesian 3-year benchmark yields are up 5.3 basis
points to 5.315%; Malaysia's 10-year benchmark yield is up 3.4
basis points at 2.532%
                Asia stock indexes and currencies at 0346 GMT
 COUNTRY        FX RIC       FX DAILY   FX YTD %  INDEX     STOCKS   STOCKS
                             %                               DAILY   YTD %
                                                            %        
 Japan                           +0.11     +2.67                  -   -5.61
 China                           -0.00     -0.06               0.42   10.43
 India                           +0.00     -4.73               0.00   -7.84
 Indonesia                       -0.27     -5.06              -0.09  -18.42
 Malaysia                        -0.19     -2.48              -0.84   -1.50
 Philippines                     +0.03     +3.25               0.43  -24.87
 S.Korea                         -0.23     -2.61               1.18    8.27
 Singapore                       +0.01     -2.03                  -  -21.02
 Taiwan                          +0.45     +2.47               0.51    7.48
 Thailand                        -0.13     -4.07               0.00  -16.17
 
 (Reporting by Nikhil Kurian Nainan in Bengaluru; editing by
Richard Pullin)
  

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