Shares end at record high on economic hopes

Shares end at record high on economic hopes

Dow Jones, Jakarta

The Indonesian stock market ended at a record high on Thursday on expectations that a meeting of international lenders, the Consultative Group on Indonesia, would produce positive results later that day, dealers said.

The lenders, which consist of donor countries, non-government organizations and international financial institutions, pledged on Thursday a total of US$3.4 billion, including $2.8 billion in loans this year to support the government's budget.

"There were expectations that any positive results from the meeting will help the nation's economy," said an analyst with a foreign securities firm.

The Jakarta Stock Exchange Composite Index ended up 7.937 points, or 0.8 percent, to hit an all-time high of 1035.75 points.

Gainers led decliners 79 to 42, with 79 stocks unchanged.

Volume was 2.55 billion shares valued at Rp 2 trillion, compared with 9.57 billion shares valued at Rp 2.47 trillion on Wednesday.

Indonesian Satellite (Indosat) led gainers, up 2.5 percent at Rp 6,150 on expectations of higher 2004 earnings and after its American Depositary Receipts rose 3.4 percent to $32.85. Indosat is expected to announce its 2004 earnings early next month.

Bank Mandiri, the nation's largest lender by assets, gained 1.6 percent to Rp 1,910 on a rebound.

Dealers said investors continued to buy infrastructure-related stocks on expectations that the companies will benefit from the government's infrastructure development plans, dealers said.

The government has said it targets infrastructure investments worth $150 billion over the next five years. The plans include projects that involve private domestic and foreign investors' partnerships with state-owned firms valued at up to Rp 306 trillion.

Cement maker Semen Gresik climbed 2.2 percent to Rp 18,700 and rival Indocement Tunggal Prakarsa was 0.8 percent higher at Rp 3,275 on hopes of higher demand for cement due to the expected infrastructure projects.

Dealers said they expect the market to trade higher on Monday, led by follow-through buying in Indosat.

The Indonesian stock market closed on Friday for a public holiday.

Meanwhile, the rupiah finished steady in range-bound trading on Thursday as capital inflows into the country's stock market offset dollar demand from local companies, dealers said.

The dollar closed at Rp 9,160, unchanged from its close Wednesday. It traded between Rp 9,150 and Rp 9,170 during the day.

Dealers said that local companies bought the U.S. unit to pay for maturing offshore obligations. On the other hand, foreign investors sold the greenback to invest in the Indonesian equity market, they said.

"The rupiah was shielded from the dollar-yen rise thanks to capital inflows into the stock market," a dealer said.

Dealers expect the dollar to trade between Rp 9,130 and Rp 9,180 on Monday.