Major Southeast Asian stock markets climbed on Friday, led by consumer and financial sectors as fears of a sovereign default by Greece faded and foreign investors returned to emerging Asian stocks. Trading volume was light, however, with turnover falling well below the 30 day average across the region, albeit with positive foreign fund flows into several markets, including the Philippines.
--- Thai market closed for holiday before election
Indonesia's main share index scaled an all-time high for the second session, climbing 1 percent. Indonesia is Asia's best performer this year, followed by the Philippines. Philippine shares rose 1.4 percent on Friday, Singapore added 0.6 percent and Malaysia edged up 0.3 percent to a fresh record. Vietnam dropped 1.7 percent.
Lower inflation in June helped lift sentiment in Jakarta, strengthening expectations Bank Indonesia will hold its policy rate at 6.75 percent this month and potentially for the rest of the year. "The market is moving up in line with other regional markets. If regional markets were down, we would be down also. However, we tend to outperform on the way up as investors like the Indonesian story," said Harry Su, head of research at broker Bahana Securities.
Annual headline inflation in Thailand also dipped in June because of lower oil prices, but core inflation edged up to 2.55 percent after a jump in May, reinforcing expectations of another interest rate rise later this month. The Thai stock market was shut on Friday. The market has suffered $1.44 billion in foreign outflows since the start of May amid risk aversion ahead of a general election on Sunday.
Asian shares opened the new quarter on a positive note, with the MSCI index of Asia-Pacific shares outside Japan touching its highest level in about a month. The index was up 0.36 percent by 0930 GMT. In Jakarta, Indonesia's biggest firm by market value and main vehicle distributor, Astra International, jumped 3.2 percent to a record high. Domestic consumption is a major driver of Indonesia's GDP and supported sentiment in consumer stocks, brokers said.
Bank Rakyat Indonesia, Indonesia's second biggest lender by assets, rose 3.1 percent to a record high, and food firm Charoen Pokphand Indonesia gained 1.7 percent, also to a record high. Singapore banks advanced after positive loan growth in May and cheered by new banking rules announced by the Monetary Authority of Singapore. They were more benign than expected and banks are likely to meet the requirements comfortably. DBS Bank, United Overseas Bank and Oversea-Chinese Banking Corp all advanced around 1 percent.