JAKARTA: Southeast Asian stocks jumped on Friday as a bigger-than-expected bond buying result of the European Central Bank boosted sentiment in risk property, and helped Indonesia notch a record high and Singapore a 20-month peak.
The European Central Bank launched a government bond-buying programme which will pump hundreds of billions in new money into a sagging euro zone economy.
Jakarta’s composite index (JCI) was up 1.3% at 5,319.53, after hitting an all-time high of 5,324.34.
Foreign investors led buying in large-caps and banks gained before earnings releases. Astra International rose 3.2% to its highest since August, while Bank Central Asia climbed 1.1% to a more than one-month high.
Stronger foreign inflows to the region due to higher liquidity are expected to be tentative, brokers said.
Bahana Securities maintained its JCI target for 2015 at 5,900.
“This is because the Indonesian market is more USD centric. Thus far we did not benefit from QE in Japan nor in the euro zone, as investors would have to convert to USD first, resulting in currency risks,” said head of research Harry Su.
“Nevertheless, our market should benefit from improved sentiment.”
Singapore’s Straits Times Index was up 1.1% at 3,409.28. It earlier hit 3,412.08, the highest since May 2013. Shares of DBS Group Holdings and Singapore Telecommunications were among the actively traded.
The rally helped Indonesia and Singapore to head for a weekly gain of more than 3%, the biggest for both since March last year.
Malaysia and Thailand are also on course for a more than 3% weekly gain. The Philippines and Vietnam are also set to extend gains for a fifth straight week.
Manila-based Regina Capital maintained a year-end target for the Philippine index at 7,800, citing high valuations. The index
was last trading at 7,506.95, up 1.2%.
