Indonesia stocks rose, snapping four-days slide, following the biggest selling of the nation’s shares by overseas investors since March 2011.
The Jakarta Composite Index jumped 1.9 percent to close at 4,697.88, rebounding from its lowest level since Feb. 19 and paring its decline from a May 20 peak to 9.9 percent. PT Astra International jumped 7.5 percent and PT Unilever Indonesia soared 9.5 percent, ending a four-day, 14 percent plunge.
Foreign investors pulled $405 million from Indonesian equities yesterday, according to data compiled by Bloomberg, taking outflows for this month to $1.04 billion. The nation’s stocks had fallen with equities in neighboring Thailand and the Philippines since Federal Reserve Chairman Ben S. Bernanke said on May 22 the central bank could consider paring stimulus if the U.S. labor market improves.
“It’s just bargain hunting. Local funds are still holding lots of cash,” Laurentia Amica Darmawan, who helps manage $530 million at PT First State Investments Indonesia, said by phone in Jakarta. “With some stocks already 30 percent below their peak, they are comfortable to get in.”
Indonesia’s rupiah forwards rose the most in a year after the central bank increased the rate it pays lenders on overnight deposits in a preemptive step to maintain monetary stability. Government bonds gained.
One-month non-deliverable forwards advanced 1.7 percent, the most since June 2012, to 10,110 per dollar, data compiled by Bloomberg show. The contracts touched 10,412 yesterday, the weakest level since August 2009. In the spot market, the rupiah fell 0.3 percent to 9,860, taking its decline this week to 0.6 percent.
Bank Indonesia raised the deposit facility rate, known as the Fasbi, by a quarter-percentage point to 4.25 percent effective today, the central bank said in a statement on its website. Indonesia has recorded six consecutive quarterly current-account shortfalls.