Indonesian stocks jumped more than 2 percent to one-year highs on Thursday, as investors bet on an election win by Jakarta Governor Joko Widodo.
The benchmark Jakarta Stock Exchange Composite index rose as high as 2.8 percent in early trade to 5,166, the highest since May 30, 2013.
Both Jokowi and ex-general Prabowo Subianto have declared themselves the winner after elections on Wednesday based on contradictory “quick count” results in the closest election ever in Southeast Asia’s largest economy.
Official results won’t be out for another couple of weeks.
“A lot of hope is being placed on Jokowi winning the polls and if he does win, that’s good news for the stock market at least in the short term,” said Vasu Menon, president of wealth management Singapore at OCBC Bank. “He’s for reforms and for new order, and promises to bring about greater transparency and that is music to the ears of investors and I think the markets are rooting for Jokowi.”
On the other hand, it could be grim for stocks should rival Probowo, who has a more nationalistic agenda, emerge as the victor.