Rupiah ends higher on capital inflows<\/p>\n
Dow Jones, Jakarta<\/p>\n
The Indonesian rupiah ended higher on Friday on capital inflows
\nin the local bond market as Bank Indonesia's rupiah support-
\npolicies gave some level of comfort to foreign investors, dealers
\nsaid.<\/p>\n
The dollar closed at Rp 10,215, down from Rp 10,360 on
\nThursday.<\/p>\n
The rupiah-support measures that Bank Indonesia announced
\nearlier this week include a 50-basis point hike in the benchmark
\nBI rate to 10 percent, a ban on dollar-rupiah margin trading and
\ntighter control on commercial banks' dollar-rupiah net open
\npositions.<\/p>\n
\"Most dollar offers came from foreign names today,\" a dealer
\nwith a European bank in Jakarta said.<\/p>\n
Dealers said London-based investors likely bought government
\nbonds on the secondary market as prices have gone lower due to
\nthe current wave of redemption in mutual funds, sparked by rising
\nlocal interest rates.<\/p>\n
Some dealers said foreign market participants also sold
\ndollars likely because they wanted to buy shares of the country's
\nsecond largest lender, PT Bank Central Asia, later this month.<\/p>\n
The government is expected to sell its remaining 5 percent
\nstake in the bank by end-September, in a deal expected to raise
\naround US$200 million.<\/p>\n
Dealers expect the dollar to trade between Rp 10,100 and Rp
\n10,300 on Monday, with the market watching oil prices on the
\nglobal market.<\/p>\n
The market is also still waiting for further measures from the
\ngovernment on its fuel subsidy policy, dealers said.<\/p>\n
Elsewhere, shares ended higher for the fourth consecutive
\nsession on Friday on further bargain-hunting as the rupiah
\ncontinued to recover against the U.S. dollar, dealers said.<\/p>\n
\"The firmer rupiah has renewed expectations that the nation's
\neconomy this year will expand as targeted,\" said a trader with a
\nlocal securities firm.<\/p>\n
The government expects the economy to expand by 6 percent this
\nyear, compared with 5 percent in 2004.<\/p>\n
Analysts said investors regained their confidence after the
\ncentral bank early this week announced a package of monetary
\npolicies, which include moves to start increasing interest rates
\nand plans to reduce fuel subsidies.<\/p>\n
The Jakarta Stock Exchange Composite index advanced 1.7
\npercent, or 18.006 points, at 1098.456.<\/p>\n
Gainers led decliners 77 to 39, with 60 stocks unchanged.<\/p>\n
Volume rose to 2.2 billion shares valued at Rp 1.8 trillion,
\ncompared with two billion shares valued at Rp 1.8 trillion on
\nThursday.<\/p>\n
Leading gainers, bellwether Telekomunikasi Indonesia (Telkom)
\njumped 4.6 percent to Rp 5,700 after its American depositary
\nreceipts in New York rose 5.1 percent and on expectations of
\nsolid nine-month earnings due to an increase in revenue from
\ncellular services.<\/p>\n
Automotive company Astra International rose 4.8 percent to Rp
\n10,900 on expectations that it will maintain solid 2005 car sales
\nif the rupiah continues to strengthen.<\/p>\n
Food company Indofood Sukses Makmur advanced 7.6 percent to Rp
\n850 on expectations that the company will soon name an
\nunderwriter for a plan to sell up to a 15 percent stake in flour
\nmill unit Bogasari Flour Mills later this year.<\/p>\n
On the downside, nickel miner International Nickel Indonesia,
\nor Inco, dropped 3.2 percent to Rp 15,000, on profit-taking after
\ngains over the previous four sessions due to expectations of
\nsolid 2005 earnings.<\/p>\n
Dealers said they expect shares to continue to trade higher
\nMonday, led by further buying in telecommunications blue chips.<\/p>",
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