Yohanes Obor & Bloomberg

Indonesian Stocks Rebound With 1.6% Gain After Mining Surge

The Indonesian stock market moved higher on Wednesday as the rising price of oil and gains in regional markets boosted buying sentiment.

The Jakarta Composite Index rose 37.75 points, or 1.6 percent, to 2,371.86. It was the steepest one-day increase since Oct. 6. Some 4.3 billion shares worth Rp 3.1 trillion ($325.5 million) changed hands. Gainers outnumbered decliners 163 to 45.

The mining sector led the way, gaining 4.1 percent. Shares in all Bakrie group companies ended the day higher.

“The JCI’s gains made up for its loss the previous day,” said Mastono Ali, an analyst at CIMB GK Securities. “Nine sectors posted gains, led by mining, especially Bumi Resources and Energi Mega Persada.”

Mastono said higher oil prices prompted buying of domestic mining stocks.

Crude oil for December delivery rebounded from a two-week low and rose 1.9 percent to $79.60 a barrel in New York on Tuesday. The contract was at $79.91 a barrel in after-hours trading as of 4 p.m. Jakarta time on Wednesday.

Mastono said the market did not react to the central bank’s decision to leave its benchmark rate unchanged at 6.5 percent on Wednesday because the decision had been widely expected.

Bank Indonesia said the rate was “conducive for the process of economic recovery.” It said inflation would be at the lower end of its target range of 3.5 percent to 5.5 percent this year, and would accelerate to 4 percent to 6 percent in 2010.

Meanwhile, the rupiah strengthened against the US dollar on Wednesday on speculation that the nation’s yield premium would attract overseas investors. It rose 0.9 percent to 9,515 as of the stock market’s close, compared with 9,600 on Tuesday.

“In the medium term, the currency will continue to be supported by the highest yield in Asia,” said Daniel Hui, a currency strategist at HSBC Holdings in Hong Kong. “We still see it rising past 9,000 to the dollar in 2010.”

Among Bakrie stocks, PT Energi Mega Persada jumped 16 percent after it disclosed that it had acquired a 10 percent stake in the Masela natural gas block. PT Bakrie Development surged 11 percent to Rp 290.

Bakrie group coal miner PT Bumi Resources rose 7.6 percent to Rp 2,475.

State-owned gold and copper miner PT Aneka Tambang rose 8.1 percent, its steepest gain since Sept. 8, to Rp 2,350. The government announced on Tuesday that Antam would be part of a consortium to buy a 14 percent stake in the local unit of US-based Newmont Mining.

PT Indo Tambangraya Megah increased 6.3 percent to Rp 23,600, while PT Adaro Energy added 3.3 percent to Rp 1,560.

PT Semen Gresik climbed 3.6 percent to Rp 7,150. PT Kalbe Farma rose 4.9 percent to Rp 1,290.