RI shares end 2.7% up on regional gains, rupiah
RI shares end 2.7% up on regional gains, rupiah
Dow Jones, Jakarta
Indonesian shares ended sharply higher Wednesday on foreign buying, boosted by gains across Asian markets amid easing oil prices, dealers said.
The rebound of the rupiah and softer on-month inflation figures in August also spurred investors to buy blue chips, they said.
"There were also renewed expectations that the forthcoming presidential runoff will proceed smoothly," said a trader with Kuo Capital Securities.
The Jakarta Stock Exchange Composite ended up 20.392 points, or 2.7 percent, at 775.096, the highest closing level since July 7.
Gainers led decliners 96 to 26, with 69 stocks unchanged.
Volume was 1.93 billion shares valued at Rp 1.32 trillion (US$141 million).
The dollar was trading lower at 9,330 rupiah compared with 9,370 Tuesday's close on a decreasing dollar demand from local companies. Meanwhile, inflation in August only rose 0.09 percent on month, far below economists' forecast of 0.57 percent.
Bellwether Telekomunikasi Indonesia was up Rp 300, or 3.9 percent, at Rp 7,950 on the company's planned 2-for-1 stock split to boost trading liquidity on the Jakarta bourse.
Carmaker Astra International rose Rp 450, or 7.1 percent, to Rp 6,800 on news that the government chose its consortium to compete with four other bidders to purchase a stake in Bank Permata.
Cigarette maker Gudang Garam gained Rp 450, or 3.5 percent, at Rp 13,200, and Bank Mandiri jumped Rp 50, or 4 percent, at Rp 1,300.
"I see that foreign funds are returning to the market," said a trader with a European securities firm.
Dealers said they expect the market to remain higher Thursday on further buying in most blue chips.
Meanwhile, the rupiah closed higher Wednesday as investors took profit in the U.S. unit after gains in the previous five sessions.
The dollar ended at Rp 9,330, down from its close of Rp 9,370 Tuesday. The greenback hit an intraday high of Rp 9,383.
Dealers also attributed the increase in the rupiah to the fact that dollar demand from local companies abated.
"It's a fair dollar correction after recent gains," said a trader with a foreign bank. The dollar rose 1.1 percent in the previous five sessions.
Dealers, however, said the underlying sentiment for the rupiah would remain weak ahead of the presidential runoff Sept. 20.
Bank Indonesia Governor Burhanuddin Abdullah told reporters he expects the pressure on the rupiah to continue until the political event is completed.
"I think the rupiah, however, will regain ground after the presidential runoff and whenever the political picture is clearer," he added.
Dealers expect the rupiah to continue to rebound Thursday. However, they said the pair is unlikely to break below a 9,300 resistance.