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Jakarta stocks rebound, late buying in blue chips

JAKARTA: Jakarta stocks ended slighlty higher on rebounds in several blue chips, recovering from earlier five-month lows.

But dealers said general sentiment is still weak with foreign investors having fled in droves to other Asian markets and local players wary of taking any positions ahead of the weekend.

The global boom in technology stocks has only added to the rush of interest offshore since the Jakarta exchange offers limited stocks of such.

The Jakarta composite index ended up 2.025 points or 0.37 percent to 548.55. Trading was still thin at an estimated 524 billion rupiah turnover.

The Jakarta stock index closed at a five-month low on Thursday after two weeks of losses. Cigarette stocks Gudang Garam and HM Sampoerna led the rebounds. Gudang Garam closed up 575 or 4.78 percent to 12,600 and HM Sampoerna rose 600 rupiah or 5.13 percent to 12,300.

Analysts said both stocks, which had declined more than 20 percent in the past two weeks, are attractive at 2000 of less than seven times, despite a planned increase in excise tax on cigarettes.

The parliament on Thursday approved an increased target of excise tax revenues to 10.27 trillion rupiah in the April-December budget from 9.27 trillion previously.

Talk of hedge funds speculating in seven big cap stocks until March 22 also hit sentiment, although the significance of this date was not clear.

Dealers expected the market to start picking up by the end of March where new developments are expected to take place, such as the end of the current fiscal year, and the announcement of the winner for IBRA's stake in Astra International.

The Indonesian Bank Restructuring Agency (IBRA), which has put its 40 percent stake in the country's largest car maker up for sale, will announce the name of winner of the bidders in the stake on March 25.

Benchmark Telkom also rebounded. It closed up 75 rupiah to 3,400. Telkom's price had been depressed lately amid government plans to sell 8.8 percent of the company to the market if it fell short of its own privatisation target by the end of March. -Reuters