* South Korea, Taiwan stocks hit all-time highs * Thailand stocks rise to highest since late-Jan * Indonesia stocks face worst day in nearly 7 months By Roshan Thomas and Rajasik Mukherjee Oct 27 (Reuters) – Most emerging Asian stock markets rose on Monday, as signs of easing trade tensions between China and the U.S. boosted risk appetite, while Indonesian shares fell sharply and were on track for their worst session in nearly seven months Leading the gains in the region, South Korea and Taiwan stocks notched fresh highs, rising about 2.5% each. Over the weekend, top Chinese and U.S. officials laid the groundwork for a trade deal, lifting expectations ahead of a closely watched meeting between U.S. President Donald Trump and Chinese President Xi Jinping on October 30 in South Korea. A trade deal between the world's two largest economies would pause steeper American tariffs and Chinese rare earths export controls. "Encouraging signals from these discussions could pave the way for a favourable outcome at the upcoming meeting between Trump and Xi on October 30," said Lloyd Chan, a senior currency analyst at MUFG. "In this context, positive momentum in Asian currencies and stock markets may well continue in the near term." Also lifting market sentiment, a softer-than-expected U.S. inflation report on Friday cemented expectations the Federal Reserve would cut interest rates by a quarter percentage point at its meeting on Wednesday. Among other markets, Thailand shares jumped 2.4% to their highest in almost nine months, after data showed customs-cleared exports rose 19.0% in September from a year earlier. Indonesian shares slumped 3.8% and were on track to log their worst session since April 8. Indonesian government bonds have become less attractive to foreign investors as the yield premium over U.S. Treasuries narrowed to around 199 basis points, below the 220-basis-point level seen as appealing, following Bank Indonesia’s rate cuts and expectations of a Fed easing, Maybank analysts said. Asian currencies rose, buoyed by hopes of a China-U.S. trade deal. The South Korean won was up 0.4%, while the Taiwan dollar gained 0.3%. The Singapore dollar and the Philippine peso were largely flat, while the Malaysian ringgit edged 0.2% higher. The Indonesian rupiah lost 0.2%. Elsewhere, Argentina's bonds and stocks are expected to rally after President Javier Milei's party scored a decisive win in midterm elections. HIGHLIGHTS: ** Trump heads to Tokyo for trade, security talks before Xi summit ** Indian economy predicted to grow at a faster-than-expected 6.7% this fiscal year – Reuters poll ** Singapore allocates more land for green energy, data centre park Asia stock indexes and currencies at 0539 GMT COUNTRY FX RIC FX DAILY FX YTD % INDEX STOCKS STOCKS % DAILY YTD % % Japan -0.19 +2.64 2.24 26.35 China India -0.19 -2.73 0.62 9.77 Indones -0.24 -3.25 -2.94 13.40 ia Malaysi +0.17 +6.05 0.33 -1.45 a Philipp -0.08 -1.19 -1.49 -9.65 ines S.Korea Singapo +0.05 +5.23 0.43 17.25 re Taiwan +0.28 +6.68 2.12 22.06 Thailan -0.09 +4.99 1.24 -5.00 d (Reporting by Roshan Thomas and Rajasik Mukherjee in Bengaluru; Editing by Subhranshu Sahu)
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