JSX share expected to keep on rising

JAKARTA (JP): Bullish trading on the Jakarta Stock Exchange (JSX) will continue this week, as the buying sentiment on blue chips is likely to remain strong.

Securities analysts said several big capitalized stocks such as Astra International, H.M. Sampoerna, Gudang Garam and BNI would remain buying targets of both local and foreign investors.

Adriansyah Chaniago of DBS Securities predicted the index would further strengthen this week on the impact of an inrease in prices of the big cap shares.

Jasmine Tedja, an analyst from HSBC Securities Indonesia said this week the market will see a strong performance, though she did not expect a higher index.

"The index reached its record high last week, and to what degree it would rise again?" she asked.

More than that, she said, the foreign investors will be back, due to the strong fundamentals of the economy. "The foreign investors are still confident about Indonesia's capital market," she said.

The JSX composite index rose 6.1 points or 0.9 percent to close at 663.97 Friday from 658.70 last week. The trading volume increased to 235.6 million shares from 150.6 million shares, with the transaction value rising from Rp 334.78 billion to Rp 476.40 billion

The securities analysts and dealers mostly attributed the increase in the share prices to an increase in prices of several blue chips or big cap stocks.

"The market was strong, especially with big cap stocks," said a dealer with a foreign brokerage firm.

Amid a strong performance of blue chip stocks, PT Telkom declined to Rp 4,000, down eight points on Jan. 17 against its price of Rp 4,200 in the previous week.

Jordan Zulkarnaen from Penthasena Securities said "stocks hit by issues were strong," though he added such was applied to local investors only.

The frequency of trading of BNI shares was high, with a total volume of 58,372 million shares worth Rp 83.3 billion, although the price dropped one point to Rp 1,400 Friday from the previous Rp 1,425. "The price of BNI declined, but transaction value increased," a foreign brokerage dealer said.

BNI's share's increase was partly due to news of the entry of Morgan Stanley Capital Index to include Bank BNI in its index.

"BNI was triggered by Morgan Stanley," Adriansyah of DBS Securities told the Post.

Several shares netted significant gains due to reports that they would either book better financial performances or receive a financing boost.

They included Barito Pacific Timber, gaining Rp 150 in the week to close at Rp 1,700.

Jasmine Tedja, of HSBC Securities Indonesia said the increase of Barito's shares was triggered by news on the syndicated loan obtained by the firm, although "it is not really good news," she said, because people had known that long before.

Penthasena's Zulkarnaen said stocks hit by rumors were strong and it was understandable, because local investors lack access to information. As a result, he said, they did not have any choice but to trade the stocks.

Last week's gainers include HM Sampoerna, which rose to Rp 14,075 from Rp 13,500; Gudang Garam, to Rp 11,750 from Rp 11,700 and Astra International, to Rp 6,150 from Rp 5,500. An analyst with a security firm said Astra's share increased due to the launch of the company's new Kijang on the market.

"Astra's shares were triggered by the launch of the new Kijang," he said.

Jordan said the market showed good signs, especially with the listing of some new companies --- PT Alter Abadi and Bank Pikko -- on the JSX and SSX, which has created enthusiasm among investors.

Last week's trading was also colored by a change in the buying direction from big shares to second-line stocks, such as Hero and Multipolar.

Prices of the two stocks rose on rumors that two companies would form a strategic alliance to better tap the country's huge retail market.

The shares of the two companies performed well. Hero Supermarket was fluctuating, but Multipolar's shares rose significantly to Rp 1,900 last Friday, compared to its price of Rp 1,700 during the previous week.

Anton Lukmanto, an executive of the Hero Group, would not comment on his company's share performance. "It's a normal thing. Rumors work that way," he said.

But an analyst with a joint venture securities firm noted that since Multipolar had successfully created a strategic alliance with Matahari Putra Prima, the same strategy might help PT Hero Supermarket to perform well.

"The investors expected the finalization of Multipolar's acquisition over Hero," the analyst said. (09)