The Southeast Asia stock slipped on Friday while Philippine shares fell the most, after MSCI's announcement of an increase in the weighting of Chinese mainland shares in global benchmarks raised outflow worries in smaller markets.
But the Indonesian index rose on the back of gains in consumer and telecom sectors.
Global index provider MSCI said on Thursday that it will quadruple the proportion of Chinese mainland shares in its global benchmarks later this year, potentially drawing more than $80 billion of fresh foreign inflows into the world's second largest economy.
The Philippine index dropped 1.4 per cent to its lowest level since Jan. 3, with broad-based losses, reports Reuters.
MSCI's announcement would result in outflows from emerging markets, such as the Philippines, into China, said Miguel Ong, a research analyst at Manila-based AP Securities.
The Philippines, one of the largest emerging economies across Asia, saw a combined net inflow of $535 million into its equities in January and February, according to exchange data.
The Malaysian benchmark index dipped 0.5 per cent, with the utilities and consumer sector taking the biggest hit.
Electricity distributor Tenaga Nasional Bhd fell 2.8 per cent and was one of the biggest drags on the index after the company reported a quarterly net loss of 134.3 million ringgit ($33.00 million), while Malaysia Airports Holdings Bhd traded 0.7 per cent lower.
The Thai index fell 0.3 per cent, dragged by telecom and material stocks.
Meanwhile, Indonesian shares gained 0.9 per cent, with conglomerate Astra International Tbk PT rising 2.8 per cent and Telekomunikasi Indonesia (Persero) Tbk Perusahaan Perseroan PT advancing 1.0 per cent.
Vietnam index pared previous session's losses to rise 0.9 per cent higher, buoyed by financial and consumer stocks.
Real estate firm Vinhomes JSC and Vietnam Dairy Products JSC added 2.3 per cent and 0.6 per cent, respectively.
The index, which is the best performer in Southeast Asia since the turn of the year, is, however, set to post a weekly loss of 1.5 per cent.
Singapore shares snapped three straight sessions of losses on Friday as financials boosted the index, with lender DBS Group Holdings Ltd scaling as much as 1.5 per cent.
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