(Dec 17): With an improving global macroeconomic backdrop and relatively cheap valuations after a torrid 2018, the omens are looking better for Southeast Asian stocks next year.

A likely pause in the Federal Reserve’s tightening cycle is already easing pressure on regional currencies, while lower oil prices are a boon for most markets. A continuation of those trends could suck back in some of the US$14 billion ($19.3 billion) of foreign money that’s gushed out of Asean stocks this year.

"Valuations in most Southeast Asian markets have dropped significantly to quite attractive levels,” said Narongsak Plodmechai, chief executive officer at SCB Asset Management Pcl, Thailand’s biggest private money manager. “We’re upbeat about the prospects for next year.”

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