BANGKOK, Sept 19: Southeast Asian stocks rallied on Thursday, with Indonesian benchmark jumping to its highest level in more than 11 weeks, joining broader Asia, buoyed by the U.S. Federal Reserve’s decision to keep monetary stimulus.
Jakarta’s Composite Index was up 4.1 percent, rising as much as 7.4 percent at one point, on the back of gains in banking shares such as Bank Mandiri and Bank Rakyat Indonesia.
Indonesia saw active trading in early hours, with a drop in U.S. Bond yields and the dollar boosting short covering across exchanges.
‘Some short covering made the early fantastic rally. People who were short selling the market expecting QE tapering were buying back shares,’ said Jemmy Paul, head of equity at Sucorinvest Asset Management in Jakarta.
The Philippine index climbed as much as 4 percent to its highest mark in five weeks amid strong buying interest in index heavyweight such as Ayala Land Inc and SM Investments Corp.
Trading volume on Philippine bourse significantly outperformed the rest of the region that was 3.3 times a full day average over the past 30 sessions.
Thai SET index gained 3.5 percent at one point, hovering near a psychological 1,500 level as players covered short positions in large cap banks such as Siam Commercial Bank Pcl and top mobile phone firm Advanced Info Service Pcl .
Trading was also heavy in shares in construction firm including Italian Thai Development Pcl ahead of the government’s debate on 2 trillion baht infrastructure loan bill due later in the day and parliamentary vote on Sept 20-21.
In a report, strategists at broker Phillip Securities said the parliamentary readings of the borrowing bill could spark a wave of speculative buying and the SET index could hit 1,500 level later in the day.
Some traders said higher prices could induce profit taking.
‘A further Thai market rally may be limited given the SET index had already made a good rebound from the low in August as hopes about the Fed stimulus have priced in,’ said CIMB strategist Kiatkong Decho in Bangkok.
In Singapore, players built up positions in large caps including top telecom firm Singapore Telecommunication , sending the Straits Times Index to its highest in almost seven weeks in early hours.
Malaysia’s main index climbed more than 1 percent to five-week highs with buying most active in banking share CIMB Group Holdings and Malayan Banking.
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SOUTHEAST ASIAN STOCK MARKETS
Change at 0435 GMT
Market Current Prev Close Pct Move
TR SE Asia Index* 425.63 408.83 +4.11
Singapore 3246.77 3193.85 +1.66
Kuala Lumpur 1790.40 1771.40 +1.07
Bangkok 1485.62 1439.13 +3.23
Jakarta 4661.29 4463.25 +4.44
Manila 6534.32 6333.96 +3.16
Ho Chi Minh 477.63 474.26 +0.71
(agencies)
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