Share prices discounted despite hike in interest rate

JAKARTA (JP): Share prices advanced further as investors continued their buying orders on most boards despite the increase in the U.S. interest rate.

The increase in the U.S. dollar interest rate came as no surprise as the market maintained its comeback course, closing the week at 492.21, up 17.31 points from the previous week.

Many analysts believe that the market had fully discounted the interest hike well in advance, and that investors were taking positions in expectation of better interim results to be further released before the end of the month.

Interim results released the previous week include those of key stocks such as Kalbe Farma, BII, Bank Danamon, Lippo Bank, Inti Indorayon, Semen Cibinong, Gadjah Tunggal, and Sumalindo.

Average daily turnover on the regular board increased to 18.63 million shares worth Rp 67.57 billion (US$31.11 million) compared to 12.86 million shares worth Rp 49.40 billion ($22.75 million) the previous week. Total turnover for the week decreased to 115.83 million shares valued at Rp 490.92 billion ($226.02 million) from 118.03 million shares valued at Rp 561.91 billion ($258.82 million) the previous week.

Foreign investors locked in funds mostly in the banking and consumer counters. They were seen focusing on BII, Panin Bank and BDNI, Matahari, Enseval, Gudang Garam, HM Sampoerna, Hero, Mayora and Dankos. Meanwhile, strong buying on BII bought-out the remaining foreign portion of the shares. There were also strong buying orders on Barito Pacific Timber despite the still declining plywood prices and lingering contention between Indonesian plywood exporters and foreign importers. Other counters which enjoyed foreign buying include SMART, Modern Bank, PSP and Mulialand.

Participating in the action, local investors focused their buying on mostly speculative counters such as Inco, Indah-Kiat, Tjiwi Kimia, Japfa and SMART.

They were also seen trading Bank Danamon, due to better than expected first half results. Meanwhile, counters which suffered large selling orders included Mayatexdian, KK Glue, Kalbe Farma and Lippo Bank.

There were 2 bonus issues listed last week, Indah Kiat (40-for-100), and Indocement (1-for-1).

Some of the best performers last week were Kalbe Farma (+Rp 1,350), Panin Life (+Rp 1,300), Ciputra Development (+Rp 825), BAT (+Rp 800), and Bank Niaga (+Rp 700). The biggest losers were Fast Food Indonesian (-Rp 3,050), Hotel Prapatan (-Rp 2,450), Suba Indah and Intraco Penta (both -Rp 600), and Sekar Bumi (-Rp 475). Gainers outnumbered losers by 83 to 36, while 23 remained unchanged.

-- Sigma Batara