Stock index drops; Unilever falls
Stock index drops; Unilever falls
Bloomberg, Jakarta
The stock index fell for a second day on Thursday. PT Unilever Indonesia had its biggest drop in a month after saying profit margins may shrink because higher energy prices are driving up costs.
PT Indocement Tunggal Prakarsa rose on the outlook for higher cement demand.
The Jakarta Composite Index slid 0.51, or 0.1 percent, to close at 1,075.40. The index, which had its biggest loss in almost four weeks on Wednesday, earlier rose as much as 0.6 percent.
Still, gaining stocks led decliners 58 to 33.
Unilever Indonesia, the local unit of the world's biggest producer of shampoo and detergents, Unilever NV, lost Rp 125, or 2.9 percent, to Rp 4,175, its biggest drop since Sept. 14.
PT Gudang Garam, Indonesia's biggest cigarette maker, fell Rp 300, or 2.9 percent, to Rp 9,900.
"It will be difficult for cigarette makers because of declining purchasing power after the Oct. 1 fuel prices rise," said Adrian Rusmana Setiamihardja, head of research at PT BNI Securities in Jakarta.
The government more than doubled, on average, retail fuel prices to cut fuel subsidies.
Stocks of the country's biggest companies by value fell on speculation President Susilo Bambang Yudhoyono may shuffle his cabinet. PT Telekomunikasi Indonesia (Telkom), the nation's biggest telephone company, slid Rp 50, or 1 percent, to Rp 5,150.
"The news is adding to uncertainties," said Bagus Hananto, an analyst at PT Andalan Artha Advisindo Sekuritas in Jakarta.
Cement companies rose on optimism of higher demand after the government said it will boost spending next year. Indocement, the country's second-biggest cement maker by sales, climbed Rp 100, or 3.2 percent, to Rp 3,200.
PT Semen Gresik, the biggest, climbed Rp 400, or 2.2 percent, to Rp 18,500.
Top economics minister Aburizal Bakrie said today the government plans to boost spending on roads and ports next year. The government forecasts spending Rp 645.1 trillion in 2006, up from an expected Rp 542.4 trillion this year.
The government expects the economy will grow 6 percent this year and 6.2 percent in 2006.
"The surge in government spending should be positive for infrastructure-related companies," Laksono Widodo, an analyst at Macquarie Securities Ltd., wrote in a note on THursday.
"Our favorite picks in this sector are Indocement and PT United Tractors."
United Tractors, a unit of PT Astra International, gained Rp 25, or 0.7 percent, to Rp 3,650.
PT Aneka Tambang, the world's fifth-largest nickel producer, added Rp 25, or 0.9 percent, to Rp 2,775, its first gain in five days.
PT International Nickel Indonesia, the local unit of Canada's Inco Ltd., slipped Rp 200, or 1.3 percent, to Rp 14,900. Nickel for delivery in three months on the London Metal Exchange dropped 2.4 percent to $12,050 a metric ton on Wednesday, the lowest close since Sept. 9, 2004.
PT Kalbe Farma, Indonesia's biggest drugmaker, added Rp 10, or 1.2 percent, to Rp 850.
Profit in the first nine months of the year may have increased to Rp 420 billion to Rp 425 billion, Vidjongtius, a director who like many Indonesians uses one name, said in Jakarta. Sales probably rose 26 percent to Rp 3.2 trillion, he said.