KUALA LUMPUR (May 29): Ringgit trades near a six-month low as concerns over U.S.-China trade war and slowing global growth sap demand for risk assets. Sentiment also hurt by Malaysia’s inclusion in the U.S. watchlist for currency manipulators.

* USD/MYR rises 0.1% to 4.1935; touched 4.1960 on May 23, highest since late November

** Resistance 4.2020, 4.2437, 4.2535; support 4.1565, 4.1500, 4.1413

* READ: Nine nations were included by the U.S. Treasury Department on its watchlist because they met some of the criteria, with five new additions -- Ireland, Italy, Vietnam, Singapore and Malaysia -- plus China, Japan, South Korea and Germany. India and Switzerland were removed

* Malaysia’s inclusion will underpin views that MYR is undervalued, although the nation’s trade surplus vs the U.S. isn’t excessively large, says Vishnu Varathan, head of economics and strategy at Mizuho Bank in Singapore
 
** Still, this puts Malaysia on the radar and may impede the nation’s ability to capture potential supply-chain relocation out of China

* USD/MYR is on track to test its high near 4.2020 reached late last year, followed by its October 2017 peak near 4.2440 and July 2017 high near 4.3045, according to note from Brown Brothers Harriman

* Malaysia’s 10-year sovereign bond yield steady at 3.81%

* Govt to auction RM2.5b of 15-1/2-year Islamic bonds on Thursday

* HSBC raised its call on Malaysian equities to neutral from underweight as the economy is resilient and the stocks aren’t expensive, according to note