SE Asia Stocks-Tumble as rising U.S. yields choke risk appetite; Vietnam worst hit

* Philippines down 2.2 pct, biggest fall since Nov 2016

* Vietnam down 5 percent at lowest close since Aug 2015

* Asian shares ex-Japan see worst fall since late 2016

By Nikhil Nainan

Feb 5 (Reuters) - Southeast Asian stock markets plunged on

Monday as rising U.S. bond yields on worries over the prospect

of higher interest rates rattled equity investors, with Vietnam

shedding five percent to record its steepest fall in nearly

two-and-a-half years.

Asian shares fell their most in over a year after fears of

resurgent inflation toppled Wall Street on Friday from all-time

highs.

MSCI's broadest index of Asia-Pacific shares outside Japan

dropped as much as 2 percent, extending losses

into a third straight session.

“There is a cautious mood currently because of the sudden

surge in yields, so I think markets are trying to adapt to this

changing environment of changing yields and expectations of

higher inflation going forward,” said Joel Ng, a research

analyst at KGI Securities in Singapore.

Global bond yields have been rising on expectations of

improving global growth, which has investors worried about the

impact of rising borrowing costs on consumers and companies.

Shares in Singapore closed 1.3 percent lower as

financial stocks dragged the index lower.

Top lenders Oversea-Chinese Banking Corp and DBS

Group Holdings suffered their worst session in over a

month, while United Overseas Bank fell to a four-week

low.

Although higher interest rates tend to bode well for

lenders, a sudden or much faster rise in yields will cause some

problems in the equity markets, Ng added.

Indonesian shares recouped part of their early

losses after data showed the economy grew at its fastest pace in

four years in October-December.

Consumer stocks weighed heavy on the index, with Astra

International Tbk PT falling as much as 2.9 percent.

Unilever Indonesia Tbk PT closed 1.1 percent lower.

Philippine shares closed 2.2 percent lower as

heavyweights SM Prime Holdings and SM Investment

witnessed selling pressure.

Vietnamese shares plummeted 5 percent on Monday,

marking their worst day since Aug 2015.

Thai and Malaysian shares closed around one

percent lower.

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SOUTHEAST ASIAN STOCK MARKETS

Change on the day

Market Current Previous close Pct Move

Singapore 3482.93 3529.82 -1.33

Bangkok 1810.32 1827.35 -0.93

Manila 8616 8810.75 -2.21

Jakarta 6589.675 6628.82 -0.59

Kuala Lumpur 1853.07 1870.48 -0.93

Ho Chi Minh 1048.71 1105.04 -5.10

Change on year

Market Current End 2017 Pct Move

Singapore 3482.93 3402.92 2.35

Bangkok 1810.32 1753.71 3.23

Manila 8616 8558.42 0.67

Jakarta 6589.675 6355.654 3.68

Kuala Lumpur 1853.07 1796.81 3.13

Ho Chi Minh 1048.71 984.24 6.55

(Reporting by Nikhil Kurian Nainan in Bengaluru; Editing by

Vyas Mohan)