Shares end at record high; profit-taking looms

Shares end at record high; profit-taking looms

Dow Jones, Jakarta

Indonesian shares ended slightly higher at a new closing high on Monday, catching up on gains in the U.S. and on other regional bourses last week, dealers said.

The local stock market was closed for a Muslim Holiday from Monday to Friday last week.

Profit-taking, however, erased some of the gains.

The Jakarta Stock Exchange Composite index ended up 0.6 percent at a new all time closing high of 939.991. The index touched an intraday high of 941.736 earlier in the day.

Decliners led gainers 62 to 60, with 81 stocks unchanged. Volume reached 1.2 billion shares valued at Rp 1.5 trillion.

"Profit-taking failed to dampen the overall sentiment toward local stocks," a dealer said. He added that foreigners continued to buy local stocks because most of them reported better-than- expected earnings during the first nine-months of the year.

Indonesia's largest telephone operator Telkom rose 4.8 percent to Rp 4,950. Its rival Indonesian Satellite, however, gave up the gains it recorded earlier in the day and closed flat at Rp 5,600.

Bank Mandiri closed up 4.4 percent at Rp 1,775, but Bank Central Asia closed lower 1.8 percent at Rp 2,700.

Automotive company Astra International fell 1.2 percent to Rp 8,450 and cigarette maker HM Sampoerna dropped 4.3 percent to Rp 6,750.

Dealers said that they expect profit-taking to intensify Tuesday after the main index's 9 percent gain since the beginning of the month.

Meanwhile, the rupiah ended slightly higher, thanks to bearish global sentiment on the dollar, dealers said.

The U.S. unit ended at Rp 9,000, down from its last close at 9,040. The greenback touched an intraday low of 8,945.

The local foreign exchange currency market was closed last week due to a Muslim Holiday.

Dealers said demand from local importers and other local companies prevented the dollar from falling further.

"Importers and local companies with offshore debt accumulated the dollar on its slide to below 9,000, likely for payment of offshore obligations by the end of the year," a dealer said.

Local companies are saddled with total offshore borrowings of around US$60 billion. Repayment of the debt usually boosts demand for the U.S. currency.

Still, dealers said worries over the U.S.'s huge trade and budget deficits will likely benefit the dollar's major rivals and the rupiah for the time being.

Dealers expect the rupiah to trade between 8,975 and 8,995 per dollar on Tuesday.