By Shriya Ramakrishnan
Aug 26 (Reuters) - Asian stocks drifted lower on Wednesday as rising COVID-19 cases and grim U.S. data dented sentiment, while currencies slipped into a holding pattern ahead of U.S. Federal Reserve Chairman Jerome's Powell's speech.
With U.S. consumer confidence dropping to a six-year low, Singapore shares .STI retreated from a one-week high hit on Tuesday on signs of progress in U.S.-China trade negotiations, while the Shanghai Composite index .SSEC eased 1.3%.
Seoul's export-focused KOSPI .KS11 managed a marginal gain and the won KRW=KFTC ended down 0.1%, as health authorities warned that South Korea was on the brink of a nationwide COVID-19 outbreak.
In currency markets, traders were firmly focused on Powell's speech on the U.S. central bank's policy framework review at this year's virtual edition of the Jackson Hole symposium on Thursday.
Investors are waiting to see if Powell signals a shift in the Fed's inflation target to an average, which would allow inflation to rise more quickly than in the past.
The Indonesian rupiah IDR= traded 0.3% lower, while the Thai baht THB=TH found some support from more stimulus measures to support domestic tourism.
India's rupee INR=IN dipped slightly as dealers reported the central bank's return to the market after a halt in intervention against the currency on Monday, which had helped the rupee surge against the dollar.
"The reason why the central bank could have let the 74.50 level break is to shatter complacency and prevent speculative positions from building up," said Abhishek Goenka, chief executive officer of forex advisory services firm IFA Global.
"We expect USD purchases and reserve accumulation by the central bank to continue."
Philippine shares .PSI, the worst performer in the region so far this year, fell 0.4% as coronavirus cases continued to rise, in what appears to be the largest outbreak in Southeast Asia.
"The Philippine market in particular is smaller in size and has lower liquidity. The growth outlook is constrained but we believe the combination of cheap valuations and large underweight positioning reflects that already," said Devendra Joshi, ASEAN and frontier markets equity strategist at HSBC Global Research.
** Top losers on FTSE Straits Times Index .STI include SATS Ltd SATS.SI, down 4.2% at S$2.97, and United Overseas Bank UOBH.SI, down 2.3% at S$19.59
** Top gainers on Thailand's SETI .SETI include VGI PCL VGI.BK, up 14.3% at 6.8 baht, and Sri Trang Gloves (Thailand) STGT.BK, up 5.5% at 71.5 baht
Asia stock indexes and currencies at 0721 GMT
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(Reporting by Shriya Ramakrishnan in Bengaluru; Editing by Subhranshu Sahu)
((Shriya.Ramakrishnan@thomsonreuters.com; +91 8061822842 ;))
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