Shares end higher on buying in blue chips

Shares end higher on buying in blue chips

Dow Jones, Jakarta

Indonesian shares ended higher on Monday, led by gains in telecommunications and mining blue chips, with the strength of the rupiah providing support, dealers said.

"Buying wasn't strong, however," said a trader with Kuo Capital Securities, adding that local institutional funds continued to take profit in shares that gained last week.

Dealers said the gains indicate that underlying sentiment for the Indonesian shares remains positive ahead of the announcement of new Cabinet lineup Oct 20.

The Jakarta Stock Exchange Composite index ended up 4.425 points at 860.144, slightly down from an earlier high of 863.096.

Gainers led decliners 88 to 43, while 74 stocks are unchanged. Volume was 1.4 billion shares valued at Rp 1.1 trillion.

Bellwether Telekomunikasi Indonesia rose 1.8 percent to Rp 4,350, and rival Indonesian Satellite Corp. ended up 0.6 percent at Rp 4,375 on a rebound.

Nickel miner International Nickel Indonesia, or Inco, gained 4.2 percent at Rp 12,500, and tin producer Timah jumped 8.5 percent to Rp 2,225. Dealers attributed buying in these mining shares to expectations of higher 2004 earnings on rising nickel prices.

Also higher were shares of carmaker Astra International, up 1.3 percent at Rp 7,750, after the government picked the company, which teamed up with London-based Standard Chartered PLC, as the preferred bidder for a 51 percent stake in Bank Permata.

Profit taking, however, hit shares in Bank Mandiri, down 1.6 percent at Rp 1,550, and Bank Danamon, down 0.7 percent at Rp 3,725.

Bank Permata fell 7 percent to Rp 1,000, also on profit- taking.

Dealers said they expect the market Tuesday to trade sideways, with a further rebound in select blue chips likely to keep the main index in positive territory.

Meanwhile, the rupiah closed marginally higher on Monday, with demand from local corporates lifting the dollar from its earlier low, dealers said.

The dollar ended at Rp 9,080, slightly lower from its close of 9,090 on Friday. The greenback hit an intraday low of 9,055.

Dealers said the dollar managed to recover from its earlier low as local companies that have foreign debt started to buy the currency to meet their month-end obligations.

"There were fresh dollar bids from local companies, offsetting the rupiah's gains," said a trader with a foreign bank.

Profit taking by local funds after the rupiah's gains last week prevented the greenback from falling further, he said.

Dealers said that trading was thin and quiet, with many investors staying on the sidelines amid an absence of fresh leads.

They said underlying rupiah sentiment remains positive ahead of the announcement of the new cabinet lineup, but growing corporate demand for the dollar should keep the pair between 9,025 and 9,100 Tuesday.