Shares end down as investors sell cigarette, telecom stocks

Shares end down as investors sell cigarette, telecom stocks

Dow Jones, Jakarta

Indonesian shares ended lower for the third consecutive day Thursday led by profit-taking in cigarette and telecommunication blue chips, dealers said.

They added overall sentiment remained weak given an absence of fresh leads and as the market ran out of steam after rising to a three-and-a-half year high on Monday.

The main index ended down 1.3 percent, or 7.215 points, at 565.638, up slightly from an intra-day low of 561.334.

Decliners led gainers 71 to 45, with 81 stocks unchanged.

Trading volume was 1.05 billion shares valued at Rp 476 billion, compared with 1.57 billion shares valued at Rp 690 billion on Wednesday.

Cigarette maker Gudang Garam led the decliners, falling 4.2 percent, or Rp 450, to Rp 10,250 as players cashed in after the stock gained 16 percent in the previous six sessions.

Garam's rival, Hanjaya Mandala Sampoerna, dropped 1.2 percent, or Rp 50, to Rp 4,250 after the company said its net profit for the first half of this year fell 10 percent on year to Rp 796.2 billion due to a decline in sales.

Bellwether Telekomunikasi Indonesia lost 2.9 percent, or Rp 150, to Rp 4,950 on profit-taking and after its American Depositary Receipts in New York fell 5.7 percent to $12.3.

But, shares in cement maker Semen Gresik bucked the trend, gaining 8 percent, or Rp 700, to Rp 9,500 on a rebound and after the company said Tuesday it took over the running of unit PT Semen Padang from incumbent directors who previously refused to be replaced.

Dealers said they expect the market to trade flat or slightly lower Friday on further, but milder, profit-taking.

Meanwhile, the rupiah closed lower as market participants bought dollars to cover their short positions as the U.S. unit gained against other regional currencies, dealers said.

The Rupiah ended at 8,465, down from Rp 8,430 at Wednesday's close.

Trading was quiet as the market lacked fresh incentives on which to trade, taking direction from the dollar's movements against other regional units.

However, the immediate outlook for the rupiah is favorable given the forthcoming initial public offerings of state-owned companies that are expected to attract capital inflows.

The government is expected to offer a 30 percent stake each in Bank Rakyat Indonesia and the gas distribution monopoly Perusahaan Gas Negara later this year.