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Indonesia stocks hit record, Astra jumps on auto sales
January 18, 2013 / 10:20 AM / in 5 years

Indonesia stocks hit record, Astra jumps on auto sales

BANGKOK/JAKARTA, Jan 18 (Reuters) - Indonesia’s stock index climbed another record high on Friday, as investors bought consumer stocks such as PT Astra International Tbk after record auto sales in 2012 showed domestic demand will continue to drive the economy.

The index finished up 1.5 percent at a high of 4,465.48, topping the previous peak close hit on Jan. 7. For the week, the index was up 3.7 percent, the biggest weekly gain for the market since December 2011.

Astra, which is the country’s largest listed firm and top auto distributor, has long been a favourite of foreign fund investors as a proxy to Indonesia’s consumer sector. On Friday, the stock posted its biggest gain in two weeks on Friday, moving up 3.3 percent.

Indonesian auto sales surged 25 percent in 2012 and look set to keep growing strongly this year as sharply rising wages and low interest rates encourage more consumers to swap two wheels for four.

Banks, also a popular play on consumer demand, led active trade, with the world’s biggest microlender PT Bank Rakyat Indonesia Persero Tbk up 1.3 percent and top consumer lender PT Bank Central Asia surging 3.8 percent. State telecom firm PT Telekomunikasi Indonesia rose 2.6 percent.

The gains came as traders returned to their desks after heavy flooding in the Indonesian capital on Thursday that turned the main thoroughfare into a waist-deep river, killed six people and left thousands homeless.

“Despite Jakarta being flooded, the stock market can remain above water,” said Gundy Cahyadi, an economist at OCBC Bank in Singapore.

Citigroup said the Jakarta flood’s impact on banks will be limited as the waters had not affected industrial areas. Astra’s factories were untouched, it said.

Indonesia’s central bank said it saw the weather disrupting food distribution, which in turn was likely to push up inflation this month. However, officials said rain across the country had not damaged key crops such as palm oil. The listed palm oil firm with the biggest market capitalisation, Astra Agro Lestari , gained 0.8 percent on Friday. (Reporting by Viparat Jantraprap in Bangkok and Neil Chatterjee in Jakarta; Editing by Richard Borsuk)

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