CNBC
Emerging Markets
Avantika Chilkoti and Jennifer Hughes
Financial Times
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There was a quiet air of optimism in one of
Jakarta's swankiest rooftop bars this week, where glasses clinked and
chat was cheerful as investors from New York to Hong Kong talked up
local prospects when they descended on the capital for the annual UBS
conference.
Indonesia often struggles to compete with the likes of India and China for investor interest. But even as sentiment towards emerging markets remains wary, the standout performance of Jakarta's stock market and a new confidence in the government of Southeast Asia's largest economy is attracting attention.
"Indonesia for 2016 could turn out to be the story India was supposed in 2015," says Herald van der Linde, Asia equity strategist at HSBC.
Jakarta's benchmark index has so far this year gained 4.8 per cent, and 9.7 per cent in dollar terms, ranking it among the top 10 performers worldwide. The gains come, too, as Asian stocks have in general been weighed down by fears about China.
The MSCI Asia index, excluding Japan, is down 4 per cent for the year — as are global developed world stocks — compared with a 1 per cent drop for global emerging markets, following the recent rally.
Indonesia often struggles to compete with the likes of India and China for investor interest. But even as sentiment towards emerging markets remains wary, the standout performance of Jakarta's stock market and a new confidence in the government of Southeast Asia's largest economy is attracting attention.
"Indonesia for 2016 could turn out to be the story India was supposed in 2015," says Herald van der Linde, Asia equity strategist at HSBC.
Jakarta's benchmark index has so far this year gained 4.8 per cent, and 9.7 per cent in dollar terms, ranking it among the top 10 performers worldwide. The gains come, too, as Asian stocks have in general been weighed down by fears about China.
The MSCI Asia index, excluding Japan, is down 4 per cent for the year — as are global developed world stocks — compared with a 1 per cent drop for global emerging markets, following the recent rally.
"Basically, people think that stuff is going to get done — and that will lift growth," said David Mann, chief economist for Asia at Standard Chartered. "Across the region, countries that look like they're getting better at doing what they said they'd do are getting noticed."
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