Shares End Higher, Led By Gains In Medco

Shares End Higher, Led By Gains In Medco
JP/14/Market

Shares End Higher, Led By Gains In Medco

Dow Jones/Jakarta

Indonesian shares ended higher on Thursday led by gains in gas
and oil company Medco Energi ahead of its plan to sell a 30
percent stake on the Luxembourg bourse next month, dealers said.

The Jakarta Stock Exchange's Composite Index ended up 0.7
percent at 1186.614 - another fresh high. Many analysts now
expect it to break above the key 1,200-level very soon.

"The market managed to maintain its uptrend momentum despite
sporadic profit taking by local funds," said an analyst with a
local securities firm. He expects foreign funds to continue
program buying on expectations that the nation's economy will
grow better this year than in 2004.

Decliners led gainers 73 to 55, with 77 stocks unchanged.
Volume fell to 1.7 billion shares, valued at Rp 1.24 trillion,
compared with 2.2 billion shares valued at Rp 1.7 trillion
Wednesday.

Medco jumped 11 percent to Rp 3,775 on expectations that
Encore Limited, which owns 85.5 percent of Medco, will sell a 30
percent stake in Medco at a premium. Sources at Medco said that
the company will price its shares later today.

Bellwether Telkom gained 1.8 percent to Rp 5,700 on a rebound
and expectations of improved first-half earnings. Telkom is
expected to announce its earnings on Friday.

Elsewhere, shares in Bank Rakyat Indonesia gained 4.2 percent
to Rp 3,125 after the company said its first-half net profit rose
13 percent on year.

On the down side, profit taking hit shares in carmaker Astra
International, which fell 1.1 percent, to Rp 13,000.

Dealers said local retail investors also took profit in many
small-capitalized stocks that had gained recently.

Among these, technology company Astra Graphia fell 9 percent
to Rp 355 after gaining 30 percent in the previous three
sessions.

Dealers expect shares to trade higher on Friday led by further
buying in Medco.

The Indonesian rupiah ended steady on Thursday as dollar
demand from local companies abated, dealers said.

The dollar closed at Rp 9,838 versus its close on Wednesday at
Rp 9,840.

"It seemed that most companies, which have to pay maturing
offshore obligations at the end of the month, have secured their
dollar needs," a dealer with a local bank said.

Dealers said that Bank Indonesia was heard asking about the
dollar-rupiah quote in the market, but they didn't think it
actually sold dollars.

The International Monetary Fund (IMF) recommended in its
annual review on Indonesia Wednesday that Bank Indonesia limits
interventions in the foreign exchange market to those needed to
counter short-term volatility.

The fund added that Indonesia may need higher rates to make
sure that inflation is contained and also to help the rupiah.

Dealers expect the dollar to trade between Rp 9,820 and Rp
9,840 on Friday.