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Business Times
7 days ago
- Business
- Business Times
Indonesian stocks near record high, unfazed by foreign selling
[JAKARTA] Indonesian stocks are closing in on an all-time high as booming domestic demand offsets a deluge of foreign outflows. Foreign investors have sold a net US$3.8 billion in local shares so far this year, on track for their largest annual outflow ever, according to Bloomberg-compiled data. Despite the exodus, the Jakarta Composite Index has rallied 26 per cent from an April low and is approaching its record high set in September. The disconnect between foreign selling and the benchmark's advance highlights Indonesian equities' waning reliance on overseas investors. Local retail participation and demand for stocks linked to billionaires, such as Prajogo Pangestu's Barito Renewables Energy, are supporting the South-east Asian country's shares, outweighing concerns over global trade. 'Domestic investors are backing a new generation of winners,' said Mohit Mirpuri, a fund manager at SGMC Capital. 'If this trend holds, a fresh record high could just be the beginning' for Indonesia's equity gauge. The number of local retail investors has ballooned to 17 million in 2025 from just 3.8 million five years ago, according to the Indonesia Stock Exchange. Meanwhile, foreign ownership in the nation's stocks has shrunk to about 40 per cent, down from more than 57 per cent a decade ago, Indonesia Central Securities Depository data show. A string of successful initial public offerings from companies such as infrastructure firm Chandra Daya Investasi have re-energised local investors, Mirpuri said. Its shares have climbed 837 per cent since their listing last month. He also points to Barito Renewables, whose stock has soared more than 800 per cent since its 2023 debut. Both companies are tied to Pangestu. Falling government bond yields are also prompting domestic investors to seek stocks and other assets offering higher returns, according to analysts. Indonesia's benchmark 10-year yield has declined by more than 50 basis points this year to 6.5 per cent. A softer US dollar, prospects for further interest-rate cuts by Bank Indonesia and greater certainty over global trade could lure foreign investors back, said Rajeev De Mello, global macro portfolio manager at Gama Asset Management. US President Donald Trump's decision to impose a 19 per cent levy on Indonesian imports, down from the 32 per cent rate he initially threatened, has also buoyed sentiment. Still, foreign investors could keep dumping the nation's stocks if corporate earnings disappoint, said Aldo Perkasa, head of research at Trimegah Sekuritas Indonesia. He sees the country's benchmark ending the year at 7,750 points, 3.1 per cent above on Tuesday's close. BLOOMBERG
Business Recorder
24-07-2025
- Business
- Business Recorder
Asian currencies: S Korea's won and Taiwan dollar higher
BENGALURU: Emerging Asian market equities resumed their rally on Wednesday, led by strong gains in Indonesia and the Philippines after the two countries hashed out a deal with the US for tariff rates lower than those threatened earlier. An MSCI index of emerging Asian equities jumped to a more than 3-1/2-year high, rebounding from a slight dip on Tuesday that snapped its three-day win streak. A subset of ASEAN stocks, dominated by Singapore, also jumped nearly 1%. Singapore's Straits Times index extended its rally into its 13th consecutive session - its longest ever - during which it advanced more than 5%. Indonesia's benchmark jumped more than 1%, and headed to its highest closing since mid-December. Stocks in the Philippines jumped 1.7% to mark their best day in a month. US President Donald Trump announced new import duties of 19% for goods from the Philippines, a touch below the rate of 20% he threatened earlier this month. Indonesia agreed to eliminate levies on more than 99% of US goods and scrap barriers to American firms, while the US said it will drop its tariff rate on Indonesian products to 19% from 32%. 'Asian equities are rallying on a cocktail of positives,' said Mohit Mirpuri, an equity fund manager at SGMC Capital. 'Tariff clarity with the United States across multiple fronts, including Japan and the Philippines, is lifting are rotating back into Asia, where valuations look compelling and policy risk is finally easing.' South Korea's KOSPI index advanced 0.4%, while Taiwan's benchmark jumped 1.4%. Vietnam's benchmark was largely flat in the afternoon, after touching a more than three-year high earlier in the day.
New Straits Times
23-07-2025
- Business
- New Straits Times
Tariff deals with US lift Asian stocks; currencies upbeat
NEW YORK: Equities advanced across emerging Asia on Wednesday as investors cheered new US trade deals, with stocks in Indonesia resuming their rally as Southeast Asia's largest economy hammered out tariff arrangements with the United States. The MSCI index of emerging Asian equities jumped 1 per cent to its highest since mid-November 2021, largely driven by a gain of 1 per cent in Taiwan's benchmark index. Thai stocks jumped more than 2 per cent to a two-month high, while equity benchmarks in Indonesia and the Philippines gained as much as 0.7 per cent. US President Donald Trump announced a new tariff of 19 per cent for goods from the Philippines, a touch below the rate of 20 per cent he threatened earlier this month. Indonesia hashed out details of its pact with the United States to eliminate tariffs on more than 99 per cent of US goods and scrap barriers to American firms, while the US will drop its threatened tariff rate on Indonesian products to 19 per cent from 32 per cent. "Asian equities are rallying on a cocktail of positives," said Mohit Mirpuri, equity fund manager at SGMC Capital. "Tariff clarity with the United States across multiple fronts, including Japan and the Philippines, is lifting sentiment," he told Reuters in a text message. Signs of cooling inflation and policy support from China contributed to the risk-on approach across the region, he added. "Investors are rotating back into Asia, where valuations look compelling and policy risk is finally easing." Analysts saw the economic impact of the Philippines tariff rate of 19 per cent as relatively limited. A note of caution was struck by William Bratton, head of APAC cash equity research at BNP Paribas, warning that the rates, though less severe than feared, could prove disruptive for Asian exporters and punitive for earnings in the long term. Earlier, Japan and the United States struck a deal to lower to 15 per cent the tariff on all imported goods from the steep 25 per cent Trump had previously threatened, with Japan also pledging to invest US$550 billion in the US Elsewhere in Southeast Asia, stocks in Singapore gained for a 13th straight session in their longest streak on record. They had traded most of Tuesday in the red but ended slightly higher. Stocks in Kuala Lumpur added 0.3 per cent. Equities in Bangkok were set for their strongest day in almost a week. The appointment of rate-cut advocate Vitai Ratanakorn as governor of the Thai central bank, has boosted investor confidence, though concerns linger on its independence. "His (Vitai's) remarks and public statements suggest a decisive shift towards more aggressive monetary easing and closer coordination with government fiscal policies," analysts at Citi said in a note. Among currencies, South Korea's won and Taiwan's dollar appreciated up to 0.4 per cent, while Indonesia's rupiah , Thai baht, Singapore dollar, and Malaysia's ringgit traded largely unchanged. The MSCI index of global emerging market currencies rose to a two-week peak.
The Star
03-06-2025
- Business
- The Star
Asian shares post modest gain, dollar holds drop
NEW YORK: Asian shares edged up at the open as investors awaited news on trade negotiations between the US and China before taking on risky bets. A regional stock index climbed 0.4 per cent while equity-index futures for the US dipped 0.2 per cent. Shares in mainland China fluctuated at the open on their return from a holiday Monday (June 2). Hong Kong shares advanced, erasing yesterday's losses. Treasuries were steady in Asian trading on Tuesday and the dollar was little changed after hitting its lowest since 2023 in the last session. Oil extended its gains. Investors are keeping a close eye on the latest twists in the trade war after a slew of headlines Monday. The main focus is whether US President Donald Trump and China's Xi Jinping will hold a conversation to dial down the tensions, after the two countries accused each other of violating a trade agreement reached in May. China hasn't confirmed any decision for talks between the two presidents even as the US pushes for a dialogue. "We're clearly seeing a lot of volatility and investors want more visibility,' Massimiliano Bondurri, founder and chief executive officer of SGMC Capital in Singapore, said on Bloomberg TV. "It's normal that markets are actually going to be flip-flopping. You're going to see actually even intraday swings. Could this be something that stays with us? Yes, it could.' Trump has long said that direct talks with Xi were the only way to resolve differences between the nations, but the Chinese leader has been reluctant to get on the phone with his American counterpart - preferring that advisers negotiate key issues. The last known conversation between Trump and Xi took place in January before the US president's inauguration. Top Trump economic adviser Kevin Hassett signaled Sunday the White House was anticipating a call this week with the Chinese leader. Meanwhile, Japan's top trade negotiator Ryosei Akazawa is considering returning to the US for another round of trade negotiations this week as expectations mount for a deal as early as this month. "We continue to expect market volatility as investors digest fresh tariff headlines and incoming US economic data,' said Ulrike Hoffmann-Burchardi at UBS Global Wealth Management. "Fiscal worries remain, and geopolitical tensions are heating up.' Trump worked the phones Monday and took to social media to try to sway Republican holdouts on his multi-trillion dollar tax bill, encountering conflicting demands from GOP senators even as he urged them to move swiftly. The legislation, which last month passed the House by one vote, faces opposition from both moderates and ultra-conservatives in the Senate, where Trump can afford to lose no more than three votes. In Japan, attention will once again shift to a debt market sale Tuesday that may ramp up pressure on the government to adjust its borrowing plans and calm investor nerves. Hot on the heels of auctions last month that exposed a lack of demand, the finance ministry will sell ¥2.6 trillion (US$18 billion) of ten-year notes. In geopolitics, Russia and Ukraine wrapped up a second round of talks in Istanbul that failed to bring the two sides closer to ending the war, but laid the groundwork for a new exchange of prisoners. - Bloomberg
Business Recorder
23-05-2025
- Business
- Business Recorder
Asian currencies: Thai baht falls against dollar
BENGALURU: The Thai baht surrendered early gains on Thursday after the commerce minister called for a weaker currency to bolster exports, while the Philippine peso lagged regional peers over mounting political uncertainty in the Southeast Asian country. Overall, Asian currencies gained on a weak dollar while equities fell. Thailand's currency fell 0.3% to 32.825 per US dollar after rising 0.5% earlier in the day. Equities in Bangkok traded 0.3% lower. Pichai Naripthaphan, the country's commerce minister, said he wanted a weaker baht to support exports and that a level of 36-37 per US dollar was more suitable. The minister said that Thailand's exchange rate policy was not part of ongoing trade negotiations with the United States. 'The intraday reversal likely reflects how sensitive FX markets are to verbal intervention. When a senior policymaker explicitly says the currency needs to weaken, markets take that as a green light,' said Mohit Mirpuri, equity fund manager at SGMC Capital. 'While fundamentals like tourism recovery and current account surplus support the baht medium term, these types of comments can dampen momentum short term.' The Philippine peso was only marginally higher as mounting political uncertainty in the country capped gains, while stocks fell as much as 1.7% to hit their lowest level since April-end. Political instability has deepened in the Philippines after President Ferdinand Marcos Jr. asked for the resignation of his entire cabinet, following a lackluster performance by his allies in last week's Senate elections. Maybank analysts see support for the peso, including rising inflows, as the country's economy remains relatively sheltered. Meanwhile, the central bank of Sri Lanka surprised markets with a 25-basis-point rate cut in a bid to support growth in a country facing lingering economic issues. The Sri Lankan rupee inched higher while equities in Colombo jumped as much as 0.9% to hit their highest since March 3. Among other currencies, the Indonesian rupiah, Taiwan dollar and its Singaporean counterpart gained up to 0.4%, 0.3% and 0.1%, respectively. 'Asia EM FX has mainly been lifted by market perception that the US is looking for a weaker dollar versus Asian currencies, as part of its efforts to address its deep trade imbalances with several Asian economies,' said Lloyd Chan, FX strategist at MUFG. Stocks in Taiwan, Singapore and South Korea slipped 0.6%, 0.1% and 1.2%, respectively. Investor focus remained on US President Donald Trump's tax bill, set for a congressional vote this week.
