By Shashwat Pradhan
(Reuters) – Southeast Asian stock markets rallied on Wednesday, in line with Asian peers, as the immediate impact of Britain’s vote to leave the European Union began to fade and investors bet central banks would have to ride to the rescue with more stimulus measures.
Aiding sentiment was data showing the U.S. economy grew at a 1.1 percent annualised rate in the first quarter, rather than the 0.8 percent pace reported last month.
The impact of Brexit on the markets will be temporary, with the broader southeast Asian markets taking cues from global markets following the solid U.S. economic data, said analyst Arief Budiman of Ciptadana Securities in Jakarta.
Any bounce was welcome, given global equity markets shed $3 trillion in value in the two sessions following Britain’s shock vote, according to S&P Dow Jones Indices.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1 percent to recoup around one-third of Friday’s loss.
Indonesian shares jumped 2 percent to their highest since July 3, 2015, extending gains into a third session, aided by the tax amnesty bill that is expected to create inflow of repatriated funds.
“We are not waiting for Godot … (The impact of the bill could include) lower bond yield, which means potential higher market valuation and lower funding cost,” said analyst Isnaputra Iskandar of Maybank Kim Eng Securities in a note.
Indonesia’s central bank governor expects the bill to help boost the country’s economic growth rate to around 5.2-5.3 percent this year, from 4.8 percent last year.
Philippine stocks bounced back from Tuesday’s loss and closed 1.7 percent higher, after the Finance Department said the government budget surplus widened to 55 billion pesos ($1.17 billion) in April
Singapore shares ended up 1.3 percent, with financial stocks such as DBS Group Holdings Ltd leading the rally.
(Reporting by Shashwat Pradhan; Editing by Subhranshu Sahu)