Jakarta stocks gain as fuel concerns ease; Astra paces rise

Jakarta stocks gain as fuel concerns ease; Astra paces rise

Bloomberg, Jakarta

Indonesian stocks rose for the first day in five on Monday after
U.S. refineries were spared a direct hit from Hurricane Rita,
sending oil prices lower and boosting expectations of growth in
Southeast Asia's biggest economy.

PT Astra International led gains on investor hopes the fall in
oil prices will allow the government to limit planned cuts in
fuel subsidies, boosting consumer spending.

"The market has received a boost in sentiment on the relief in
oil prices after Rita's damage was less than feared," said
Yudhistia Susanto, who helps manage the equivalent of US$28
million in assets at PT Mandiri Manajemen Investasi in Jakarta.

PT Telekomunikasi Indonesia had its biggest gain in two months
after it reached an agreement with rival PT Indosat on access
codes for each other's customers.

The Jakarta Composite Index climbed 21.73, or 2.2 percent, to
close at 1,034.59. Gaining stocks led decliners 75 to 26. The
benchmark fell 4.2 percent last week partly on concern hurricane
damage to crucial U.S. refineries would send oil prices higher.

Crude oil for November delivery fell as much as 2.4 percent to
$62.65 a barrel in after-hours electronic trading on the New York
Mercantile Exchange.

Astra, Asia's biggest auto retailer, jumped Rp 300, or 3.3
percent, to Rp 9,350. PT Indofood Sukses Makmur, the world's
biggest maker of instant noodles, added Rp 10, or 1.5 percent, to
Rp 690, its first gain in 10 days. PT Gudang Garam, Indonesia's
biggest cigarette maker, climbed Rp 50, or 0.5 percent, to Rp
10,800.

Lenders such as PT Bank Rakyat Indonesia gained on
expectations a drop in oil may help halt the rupiah's slide,
reducing pressure on the central bank to raise interest rates.

The rupiah rose 0.1 percent to 10,227 rupiah against the
dollar at 4:06 p.m. Jakarta time. It has lost 9.3 percent of its
value against the dollar so far this year as rising global oil
prices boost the cost of fuel subsidies and imports.

PT Bank Rakyat Indonesia, the fourth-largest lender by assets,
rose Rp 100, or 4.2 percent, to Rp 2,500. PT Bank Central Asia,
the second-biggest lender, added Rp 50, or 1.5 percent, to Rp
3,425.

"With oil prices falling, there is less pressure on the
rupiah" and on government fuel subsidies, said Mardesiana, an
analyst at PT Kresna Graha Sekurindo in Jakarta.

Texas refineries, including units of Exxon Mobil Corp. and
Valero Energy Corp., probably escaped major damage from Rita,
which came ashore a few miles east of the Texas-Louisiana border
on Sept. 24. The Houston area accounts for about 12 percent of
U.S. refining capacity.

Indonesia plans to raise fuel prices on Oct. 1 to reduce the
government's fuel subsidy burden, President Susilo Bambang
Yudhoyono said on Sept. 23. The government may boost prices of
gasoline, kerosene and diesel by at least 50 percent next month,
Vice President Jusuf Kalla said on Sept. 16.

Indonesia, the only member of OPEC that is a net oil importer,
is planning to reduce fuel subsidies to cut its budget deficit.
Oil has surged 46 percent on global markets this year.

Elsewhere, PT Telekomunikasi Indonesia, the country's biggest
telephone company, and PT Indosat, the second-biggest, gained
after they agreed to allow their customers to connect with each
other's networks.

The agreement enables Indosat's customers to use the '0'
access code for domestic long-distance calls previously available
only to Telkom's users. In turn, Telkom's subscribers can make
international calls using the '001' access code previously
available only to Indosat's customers.

"The agreement gives Telkom benefits," said Katarina Setiawan,
an analyst at Kim Eng Securities in Jakarta. "Telkom doesn't have
to have huge marketing costs" to introduce new access codes to
expand services.

Telkom jumped Rp 275, or 5.6 percent, to Rp 5,200, the biggest
one-day gain since July 22. Indosat gained Rp 125, or 2.5
percent, to Rp 5,075.