Shares end at record high on telecoms rebound
Shares end at record high on telecoms rebound
Dow Jones, Jakarta
Indonesian shares ended higher on Friday, with a further
rebound in Telekomunikasi Indonesia and Indonesian Satellite
driving the main index to close at a fresh record high, dealers
said.
They added that underlying sentiment toward Indonesian shares
remains positive due to expectations of higher 2004 corporate
earnings and a better-performing economy under the new
government.
Analysts said the dollar's global weakness should also trigger
positive sentiment toward many Indonesian companies that have
dollar-denominated debt.
"If buying continues, the main index could hit the 1,000-level
by the end of this year," said an analyst with Kuo Capital
Securities.
The Jakarta Stock Exchange Composite Index ended up 9.535
points, or 1 percent, to reach an all-time closing high of
965.216. The main index fell 0.6 percent on Thursday on profit-
taking.
Gainers led decliners 98 to 35, with 81 stocks unchanged.
Volume was 1.8 billion shares valued at Rp 1.3 trillion
(US$144.61 million).
Bellwether Telekomunikasi Indonesia gained 1 percent, to Rp
5,000 on bargain-hunting after it fell 2.9 percent Thursday.
Telkom's rival Indonesian Satellite rose 1.8 percent to Rp
5,800 on a rebound after falling 5 percent Thursday.
Dealers said investors bought back these telecommunication
blue chips on expectations of higher 2004 earnings due to higher
revenue from cellular services.
Meanwhile, Bank Danamon, the nation's fifth largest lender,
rose 1.8 percent to Rp 4,300, on expectations of solid 2004
earnings due to an increase in new lending.
Dealers said bargain-hunters also bought back shares in the
nation's largest cement maker Semen Gresik, which ended up 1.6
percent at Rp 12,800 on expectations of an improved financial
outlook due to stronger cement demand from local infrastructure
and housing sectors.
Shares in Bank Central Asia, however, succumbed to profit-
taking, ending down 1.9 percent at Rp 2,625.
Dealers said they expect the market Monday to trade higher on
follow-through buying by foreign investors in telecommunication
and bank blue chips.
Meanwhile, the rupiah ended slightly lower as market
participants took profit ahead of the weekend on the local
currency's recent gains, dealers said.
The dollar closed at Rp 8,990, up from its close Thursday at
8,955.
Dealers said most foreign investors locked in their profits on
worries of intervention by the Bank of Japan to support the
dollar against the yen.
"If Japan's central bank intervenes to prop up the dollar
against the yen, it will also have an impact on the dollar-
rupiah," a dealer with a foreign bank in Jakarta said.
In addition to improving investor perception of Indonesia's
politics, the dollar's global weakness was the other main factor
of the greenback's slide against the Indonesian unit earlier this
week.
Dealers said due to concerns about the possible intervention
by the Bank of Japan, the domestic market generally discounted
news that Indonesia's economy grew 5 percent on year in the third
quarter of the year. The pace picked up from the 4.5 percent rise
in the second quarter and beat the average 4.6 percent forecast
of analysts polled by Dow Jones Newswires.
Dealers expect the dollar to trade between 8,950 and 9,025
Monday.