Indonesia bounces back after rate hike; Thailand extends falls

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BENGALURU (Aug 15): Indonesian shares bounced back on Wednesday after the central bank raised rates for the fourth time since mid-May to defend the rupiah, while Thai and Vietnam stocks fell in line with broader Asia.

The key Jakarta stock index fell as much as 1.4% before reversing course to end 0.8% higher after two straight sessions of sharp falls.

Bank Indonesia raised its 7-day reverse repurchase rate by 25 basis points to 5.50%, as expected by six of 19 economists in a Reuters poll.

The rupiah has lost more than 7% this year, making it one of the worst performing Asian currencies, amid concerns about economic growth.

Weak fundamentals have also led to capital outflows, which have weighed on the stock market. The country posted a wider-than-expected trade deficit in July.

Telecom and energy stocks led the gains. Telekomunikasi Indonesia climbed 2.4%, while coal miner Bayan Resources rose 5.3%.

Consumer stocks also gained after the government said it would impose import tariffs on consumer goods.

MSCI's broadest index of Asia-Pacific shares outside Japan slid more than 1% to its lowest since August 2017, as concerns about Turkey's financial crisis weighed on investor appetite even though the lira moved away from an all-time low.

The lira — which plummeted to a record 7.24 to the dollar on Monday, rattling global markets — was about 2.9% stronger at 6.16 after rebounding more than 8% overnight.    

Vietnam shares fell 1.7%, the biggest single-day fall in more than one month. Financials and utilities were the biggest losers.

Joint Stock Commercial Bank for Foreign Trade of Viet Nam declined 3.5%, while Petrovietnam Gas Joint Stock Corp shed over 6%.

Thailand stocks fell for a second straight session and closed more than 1% lower with energy stocks leading the decline after oil prices softened.

PTT Pcl and PTT Exploration and Production Pcl were the biggest drags on the benchmark index.

Oil prices were weighed down by gloomier global economic outlook, as well as reports of rising US crude inventories.

Change on the day

Market             Current  Previous close  % move
Singapore          3234.12  3242.87         -0.27
Bangkok            1676.29  1695.35         -1.12
Manila             7540.92  7527.78         0.17
Jakarta            5816.59  5769.873        0.81
Kuala Lumpur       1785.94  1783.78         0.12
Ho Chi Minh        961.37   978.27          -1.73

Change on year

Market             Current  End 2017        % move
Singapore          3234.12  3402.92         -4.96
Bangkok            1676.29  1753.71         -4.41
Manila             7540.92  8558.42         -11.89
Jakarta            5816.59  6355.654        -8.48
Kuala Lumpur       1785.94  1796.81         -0.60
Ho Chi Minh        961.37   984.24          -2.32