RI shares hit record high on hopes for new govt
RI shares hit record high on hopes for new govt
Dow Jones, Jakarta
Indonesian shares ended higher for the fifth straight session
Tuesday on growing hopes that the new government will be able to
restore investors' confidence in the country, dealers said.
"Buying, however, wasn't that strong," said a trader with a
local securities firm. He added that profit-taking by local
institutional funds prevented the main index from rising further.
The Jakarta Stock Exchange Composite index ended up 4.869
points, or 0.6 percent, to hit a record high of 861.318.
Decliners, however, led gainers 63 to 60, with 96 stocks
unchanged.
Volume was 3 billion shares valued at Rp 1.9 trillion.
Bank and automotive blue chips led the gainers.
Bank Central Asia jumped 8.2 percent to Rp 2,300 and Bank
Mandiri ended up 3.3 percent at Rp 1,575 on expectations that the
central bank won't raise interest rates following the recent
report of softer inflation for September.
Carmaker Astra International rose 2.7 percent to Rp 7,650 on
expectations of higher nine-month earnings due to robust car
sales.
Bellwether Telekomunikasi Indonesia was up 1.2 percent at Rp
4,400 after its American Depositary Receipts in New York rose
2.7 percent to $18.80 Monday.
Nickel miner International Nickel Indonesia, or Inco, fell 8
percent to Rp 11,450, and tin producer Timah ended down 1.2
percent at Rp 2,075, both on profit-taking.
Dealers said they expect the market Wednesday to trade higher
on further buying in select blue chips, with profit-taking by
local funds likely to cap gains.
Meanwhile, the rupiah ended slightly higher Tuesday, as short-
term capital continued to enter the country after the peaceful
completion of presidential elections in the country
President Megawati Sukarnoputri Tuesday conceded defeat in the
country's first direct presidential elections, paving the way for
the victor, retired General Susilo Bambang Yudhoyono, to push
through reforms to restore investor confidence.
Fitch Ratings Tuesday raised its outlook on Indonesia's B+
sovereign ratings to positive from stable to reflect diminished
political uncertainty following the elections as well as the
improved outlook for reform.
The ratings upgrade had been widely expected and so failed to
provide further impetus to the local currency, dealers said.
The dollar closed at 9,090 rupiah, down slightly from its
close Monday at Rp 9,105.
The dollar fell to an intraday low of Rp 9,050 before profit-
taking against the rupiah provided the U.S. currency support.
"Foreign investors continued to buy Indonesian portfolios, and
the short-term capital inflows are expected to drag the dollar to
Rp 9,000 in the near term," a dealer at a local bank said.
J.P. Morgan also is upbeat on the rupiah's short-term outlook,
forecasting the currency would strengthen toward Rp 8,500 against
the dollar by the end of the year.
Dealers expect the dollar to trade between Rp 9,025 and
Rp 9,150 Wednesday.