Rupiah ends steady; BI measures help<\/p>\n
Dow Jones\/Jakarta<\/p>\n
The Indonesian rupiah ended steady on Wednesday as Bank
\nIndonesia's further measures to help the local unit seemed to
\nbring some results, dealers said.<\/p>\n
The dollar closed unchanged at Rp 10,360.<\/p>\n
Dollar buying from margin trading speculators to cover short
\npositions in the greenback prevented the local unit from
\nappreciating, traders said. These speculators squared short
\ndollar positions built above Rp 11,000 last week as Bank
\nIndonesia later this month will ban dollar-rupiah margin trading.<\/p>\n
The policy is part of the rupiah-support measures that the
\ncentral bank announced Tuesday, which include raising its
\nbenchmark BI rate by 50 basis points to 10 percent.<\/p>\n
\"Trading was quiet and smooth, showing that the central bank's
\npolicies worked for the time being,\" a dealer with a local bank
\nsaid. \"Easing global oil prices were also positive for the
\nrupiah.\"<\/p>\n
Still, the market is waiting for further steps by the
\ngovernment, including cutting fuel subsidies to keep the state
\nbudget sustainable and improving the investment climate to bring
\nin capital inflows, dealers said.<\/p>\n
President Susilo Bambang Yudhoyono said last week that the
\ngovernment plans to cut fuel subsidies after October. But, Bisnis
\nIndonesia daily Wednesday quoted a local senator as saying that
\nthe government might bring forward the cutting of fuel subsidies
\nto October.<\/p>\n
Dealers expect the market to remain calm on Thursday, with the
\ndollar trading between Rp 10,200 and Rp 10,390.<\/p>\n
Indonesian shares ended marginally higher on Wednesday, led by
\ngains in cement blue chips on expectations of improved 2005
\nearnings due to rising domestic demand, dealers said.<\/p>\n
Overall sentiment was cautious amid concerns over the rupiah,
\nwhich hasn't strengthened despite a central bank move to raise a
\nkey interest rate to defend the currency, they added. At 0900
\nGMT, the U.S. dollar was trading unchanged at Rp 10,360.<\/p>\n
The central bank Tuesday increased the benchmark Bank
\nIndonesia Rate by 50 basis points to 10 percent in an effort to
\nprevent steeper declines in the rupiah, which has dropped sharply
\nagainst the U.S. dollar due to the impact of the high oil prices
\nand the government's payment of oil subsidies.<\/p>\n
\"The main index came off its intraday high as investors
\nswiftly took profit amid concerns over the movement of the
\nrupiah,\" said a trader with a local securities firm.<\/p>\n
The Jakarta Stock Exchange Composite index ended up 0.7
\npercent, or 7.786 points, to 1059.380, off its intraday high of
\n1063.638.<\/p>\n
Gainers led decliners 73 to 34, with 66 stocks unchanged.<\/p>\n
Volume rose to 958 million shares valued at Rp 1.2 trillion,
\ncompared with 850 million shares valued at Rp 853 billion on
\nTuesday.<\/p>\n
Semen Gresik, the nation's largest cement maker, jumped 5.7
\npercent to Rp 16,600 on a rebound and expectations of solid 2005
\nearnings. \"The company has the lowest financing cost and foreign
\nexchange fluctuation risk\" among cement makers, Kim Eng
\nSecurities said in a research note. The note added that Gresik's
\ndebts are mostly in rupiah.<\/p>\n
Gresik's rival Indocement gained 3.4 percent to Rp 3,050 and
\nSemen Cibinong advanced 4.7 percent to Rp 450, on bargain-hunting
\nafter recent falls.<\/p>\n
Dealers said investors continued to buy crude palm-oil shares
\non expectations of improved 2005 earnings due to rising commodity
\nprices.<\/p>\n
Palm oil producer Astra Agro Lestari rose 2.9 percent to
\nRp 4,400 and rival London Sumatra gained 1.2 percent to Rp 2,175.<\/p>\n
Profit-taking hit bellwether Telekomunikasi Indonesia, which
\nfell 1 percent to Rp 5,200 and nickel miner International Nickel
\nIndonesia, or Inco, which ended down 1 percent at Rp 15,500. Inco
\nshares rose early this week due to expectations of solid 2005
\nearnings as its revenue is denominated in U.S. dollars.<\/p>\n
Dealers said they expect shares to continue to trade higher
\nThursday on further buying in cement and plantation blue chips.<\/p>",
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