UOB shares gain on Fed rate hike expectations; yen softens

United Overseas Bank shares advanced during the week as investors responded positively to expectations of a Federal Reserve rate increase at the central bank's December policy meeting. The gains reflected broader sentiment among regional financial institutions that the Fed will proceed with tightening measures.

RHB Bank and UOB, among other regional lenders, have signalled their anticipation of the rate hike. Higher US interest rates typically benefit banks through wider net interest margins, as they can charge more on loans while managing deposit costs.

The Japanese yen weakened against the Singapore dollar during the trading week, reflecting currency market adjustments to shifting interest rate expectations and broader economic factors. The movement in regional currency pairs underscored the sensitivity of Asian markets to US monetary policy decisions.

Financial markets across South and Southeast Asia remain focused on the Fed's December decision, with investors reassessing portfolio positions ahead of the expected announcement. Banking sector stocks have been among the most responsive to interest rate outlook changes, given their direct correlation to borrowing and lending costs in the financial system.