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Thursday, December 9, 2010

Asian stock markets Banks push Indonesia to record high

Asian stock markets Banks push Indonesia to record high ; Most Southeast Asian stock markets eked out small gains on Thursday, with Indonesia hitting a record high as local investors snapped up small banks due to hopes of strong earnings in 2011. Indonesia .JKSE, the region's best performer this year with a 49 percent gain, closed 0.4 percent higher at an all-time closing high. The index also hit an intraday peak of 3,788.57, Reuters data showed.

Shares in Bank Internasional Indonesia (BNII.JK) soared 25 percent, while Bank CIMB Niaga (BNGA.JK) jumped 8.4 percent following a 20 percent rise in the previous session. "Investors see the discrepancy in valuations between big and small banks -- big banks have become expensive," said Harry Su, head of research at Jakarta-based Bahana Securities.

"Despite high valuations, we expect the index to reach 4,500 by end-2011 as the country is poised to be upgraded to investment grade next year. This is the reason Indonesia still
continues to remain buoyant and attract inflows despite expensive values."

However, foreigners sold a net $36.5 million of shares on the day, which some analysts attributed to high valuations. Indonesia is trading at 15.4 times this year's projected earnings, the highest in the region and compared to all-Asia's 13.2. Thailand is trading at 12.3, lower than the 14 of Singapore, 13.9 of Malaysia and the Philippines' 13.5, Thomson
Reuters StarMine data show.

Indonesia's MSCI index .MIID00000PID has risen 29.5 percent so far this year. Thailand's MSCI .MITH00000PTH index has outperformed the region with a 37.5 percent gain compared
to Singapore's .MISG00000PSG 8.5 percent, Malaysia's 19.6 percent and the Philippines' 23.1 percent.

Thailand .SETI, despite foreign outflows of $6.1 million, rose 1.1 percent in thin volume, while Malaysia .KLSE gained 0.7 percent to a one-month high, Singapore .FTSTI edged up 0.2 percent and Vietnam .VNI added 1.7 percent.

The Philippines .PSI bucked the trend with a 0.3 percent fall, led by energy shares, with Aboitiz Power and Manila Electric Company (Meralco) (MER.PS) losing 3.1 percent and 1.5 percent respectively. Despite the general gains, analysts said the markets were still concerned about the euro zone debt crisis and possible monetary tightening in China.

In Bangkok, a 2.4 percent gain in top industrial conglomerate Siam Cement SCC.BK and a 1.1 percent rise in the country's top olefins maker, PTT Chemical PTTC.BK, helped
boost the overall market in light volume. "Investors are a bit cautious over China's inflation data
expected this weekend as the Thai market is heading for athree-day weekend," said Teerada Charnyingyong, a senior strategist at Phillip Securities. Read More... For the latest updates PRESS CTR + D or visit Stock Market news Today

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