JAKARTA: Indonesian stocks rallied to a one-year high on Thursday after most unofficial tallies showed Jakarta governor Joko Widodo ahead of ex-general Prabowo Subianto in a closely fought race to lead Southeast Asia’s biggest economy.
Both candidates declared victory on Wednesday (Thursday in Manila) in the tightest and most divisive presidential election since the downfall of dictator Suharto in 1998.
However, the polling agencies considered most reliable indicated a Widodo win, and the Jakarta benchmark index surged more than 2.5 percent at the open.
Investors have been hoping for victory for the Jakarta governor, the first serious presidential contender without deep roots in the Suharto era, seeing him as a potential reformer and clean leader in a graft-ridden country.
Stocks eased slightly in early afternoon trade but remained more than 1.8 percent up and at their highest level since May last year. The rupiah, which has retreated in recent weeks as Prabowo gained ground against Widodo, was up 0.6 percent at 11,565 to the dollar.
Official results are not expected until July 22.
“Joko Widodo looks to have won [the]presidential election in Indonesia, and hopes are high that he will make a fresh start on economic reform,” said Gareth Leather from Capital Economics.