SE Asia Stocks-Rise on bargain hunting, Vietnam falls

By Chua Baizhen

SINGAPORE, Jan 9 (Reuters) - Southeast Asian shares
rebounded from early losses to close mostly higher on
Wednesday, as investors went bargain hunting after recent falls
and bought stocks with strong fundamentals such as Singapore's
OCBC (OCBC.SI).

The city-state's Straits Times Index .STI ended 0.2
percent higher, reversing a 4-½ month low touched earlier in
the session. Jakarta shares .JKSE added 1.6 percent to close
at a new record, Malaysian stocks .KLSE rose 0.1 percent, and
Thai shares .SETI climbed 1.1 percent.

But market players in Manila gave up gains made a day ago
in Philippine Long Distance Telephone Co (TEL.PS), pushing the
stock down 1.6 percent and the index .PSI 0.1 percent lower.
Vietnam's main index .VNI also closed down 1.7 percent.

"I think investors have started to differentiate between
strong fundamentals in emerging markets and Asia, and the
United States," said Khiem Do, a fund manager at Baring Asset
Management.

"They have actually taken advantage of weak days in the
strong economies to add to their positions, instead of being
totally dominated by U.S. markets," he said.

In Singapore, Oversea-Chinese Banking Corp (OCBC) led gains
with a 1.9 percent rise, while top bank DBS Group (DBSM.SI)
added 1.3 percent and No. 2 United Overseas Bank (UOBH.SI)
climbed 0.9 percent.

Citigroup said in a note that it is overweight on the
country's banking stocks, whose earnings are expected to expand
firmly in 2008 on strong loan growth despite short-term U.S.
subprime concerns.

"Singapore emerges as a sector with reasonable valuations,
robust fundamentals that look set to continue throughout 2008,
and the additional boost of 'cheap money' driving asset
prices," said Citigroup analyst Jit Soon Lim, referring to low
domestic borrowing costs.

Singapore Airlines (SIAL.SI) rose 1 percent after the
airline lost its bid to buy a stake in carrier China Eastern
(0670.HK). The firm said that it will not walk away from the
failed deal, but ruled out prospects for a bidding war.
[ID:nSGC001593]

In Jakarta, banks and plantation stocks helped lift the
index, with No. 4 Bank Rakyat Indonesia (BBRI.JK) rising 4
percent and Bank Central (BBCA.JK) up 2.8 percent.

Astra Agro Lestari (AALI.JK) climbed 10.9 percent as
investors pinned their hopes on strong earnings for the
plantation firm amid record-smashing crude palm oil prices.
London Sumatra (LSIP.JK) rose 8.2 percent.

Plantation plays in Malaysia also rose, with Sime Darby
(SIME.KL) up 2.4 percent and KL Kepong (KLKK.KL) rose 0.5
percent.

But gains were capped by a 1.2 percent fall in IOI Corp
(IOIB.KL), after the company said it had raised $600 million
from a convertible bond, taking advantage of a global commodity
boom and giving it a war chest for acquisitions.
[ID:nKLR122157]

The stock had hit new highs earlier this week.

In Thailand, top energy firm PTT PCL PTT.BK jumped 3.6
percent while its unit PTT Exploration and Production PTTE.BK
was up 4.6 percent, as oil prices continued to strengthen on
threats of disruptions to Nigeria's oil supply and falling U.S.
crude stocks. [O/R]

Banpu PCL BANP.BK, the country's largest coal miner, rose
for the second-straight day to be 5.9 percent higher after it
told Reuters in an interview that it expects higher sales this
year and that prices should rise due to limited supplies.
[ID:nBKK303724]
(Editing by Neil Chatterjee)