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Foreign Funds Boost Indonesian Stocks
March 02, 2010

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The Jakarta Composite Index posted its biggest one-day gain in almost two weeks on Tuesday as foreign funds snapped up selected stocks, analysts said.

The JCI rose 21.92 points, or 0.9 percent, to close at 2,576.6. Some 3.1 billion shares worth Rp 3.2 trillion ($345.6 million) changed hands.

Gainers outnumbered decliners 108 to 66.

Infrastructure and finance stocks led the way, rising 2.4 percent and 1.2 percent, respectively.

Cece Ridwanulloh, an analyst at PT Ekokapital Sekuritas, said investors welcomed news that President Susilo Bambang Yudhoyono had accepted responsibility for the Bank Century bailout, even as uncertainties remained about the political fallout.

Cece said foreign investors were net buyers by Rp 390 billion on Tuesday, buying shares in companies expected to announce solid earnings growth for 2009.

Commodity-related gains in coal miner PT Bumi Resources and other Bakrie group shares also supported the JCI, he said.

Bumi Resources surged 6.9 percent on Tuesday after losing 6.9 percent over the previous four trading days.

Meanwhile, the rupiah lost ground against the US dollar after posting its biggest one-day gain in a month on Monday. The rupiah traded at 9,292 against the dollar as of the stock market’s close, compared with 9,269 on Monday.

“Foreign investors remain very positive on Indonesia and their investment and expansion plans have proved to be quite successful,” said Thio Chin Loo, a senior currency strategist at BNP Paribas in Singapore. “We expect foreign capital inflows into Indonesia to continue, which will support the rupiah.”

Among gainers on the JCI, PT Telekomunikasi Indonesia rose 3.7 percent, ending a seven-day losing streak, while PT Bank Central Asia gained 2.1 percent to end a three-day losing streak.

BCA’s gains followed news that it may expand into the motorcycle-financing business. 

Yohanes Obor & Bloomberg