Indonesian Stocks Snap 3-Day Losing Streak, Rupiah Gains for Second Day

Indonesian stocks staged a late-day rebound on Tuesday, closing higher for the first time since Feb. 3., thanks to bargain hunters buying beaten-down blue chips, analysts said.

The Jakarta Composite Index rose 13.91 points, or 0.6 percent, to Rp 2,489.5. Some 4.3 billion shares worth Rp 3.9 trillion ($417.3 million) changed hands. Gainers outnumbered decliners 102 to 60.

“Investors focused on buying oversold stocks, mainly blue chips,” said Purwoko Sartono, an analyst at PT Panin Sekuritas.

Cece Ridwanulloh, an analyst at PT Ekokapital Sekuritas, said some investors bought shares in state-owned companies on expectations of strong earnings growth this year.

The rupiah advanced for a second day as optimism that the economy probably expanded faster than projected in the fourth quarter of 2009 buoyed demand for domestic assets. The rupiah traded at 9,375 against the US dollar as of the stock market’s close, compared with 9,410 on Monday.

“Investors may take advantage of this sell-off to buy Indonesian assets,” said Lindawati Susanto, head of currency trading at PT Bank Resona Perdania.

“Indonesia’s economic fundamentals are still good. But the rupiah can’t avoid the global trend if everyone is going in one direction.”

State-owned cement producer PT Semen Gresik was among the bigger winners on Tuesday, climbing 3.3 percent. PT Indocement Tunggal Perkasa rose 2.7 percent to Rp 13,300.

“Faster economic growth may boost cement demand,” said Ryan Ariadi Suwarno, an analyst at PT Dongsuh Kolibindo Securities. Yohanes Obor & Bloomberg

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