Stock index gains; Astra, SG advance

Stock index gains; Astra, SG advance

Bloomberg, Jakarta

Key stock index gained on Tuesday for the second day in three. PT Astra International, the nation's biggest auto retailer, rose on a report it has formed a financing venture with Toyota Motor Corp.

Consumer-related companies such as PT Unilever Indonesia fell on concern sales in the fourth quarter will drop after the government raised fuel prices earlier this month.

The Jakarta Composite Index added 5.78, or 0.5 percent, to close at 1,095.87, after earlier declining as much as 0.3 percent.

Gainers and losers were evenly matched.

Astra International, the biggest distributor of cars and motorcycles, rose Rp 150, or 1.6 percent, to Rp 9,650.

Unilever, the biggest maker of food and soap, dropped Rp 100, or 2.3 percent, to Rp 4,350.

The government on Oct. 1 almost tripled retail kerosene prices, doubled auto diesel tariffs and raised gasoline prices by 88 percent to cut fuel subsidies.

"Consumer purchasing power has dropped after the recent fuel price increases," said Satrio Utomo, an analyst at PT Trimegah Securities in Jakarta.

"It will not be a good, fun Eid al-Fitr holiday."

Indonesia, where about 85 percent of the 238 million population is Muslim, will celebrate Eid al-Fitr in early November to mark the end of the holy month of Ramadhan.

Muslims typically travel to their hometowns for an annual pilgrimage marked by meals and acts of charity, boosting consumer sales.

PT Gudang Garam, Indonesia's biggest cigarette maker, slipped Rp 200, or 1.9 percent, to Rp 10,200.

PT H.M. Sampoerna, the third-biggest, dropped Rp 250, or 3 percent, to Rp 8,200.

"The government has just hiked fuel prices, which will cut further into purchasing power," Chandra Pasaribu, an analyst at PT Danareksa Sekuritas, wrote in a note to clients on Tuesday.

"Coupled with the impact of the fasting month of Ramadhan means the fourth-quarter is likely to be weak" for cigarette makers.

PT Perusahaan Gas Negara, the state-controlled gas distributor, lost Rp 100, or 1.8 percent, to Rp 5,500. Perusahaan Gas on Oct. 15 raised the price of gas and transmission fees for industries by 15 percent to $4.50 per million British thermal unit to cope with rising costs after the government raised fuel prices.

Elsewhere, PT Semen Gresik, Indonesia's biggest cement maker by volume, jumped Rp 350, or 2 percent, to Rp 18,100. Sales rose 9.8 percent in September from a year earlier, the company said on Monday.