Ika Krismantari, Jakarta – The stock market main index extended gains Friday for the third day this week, hovering above 1,200 on the back of good sentiment from global markets and the better-than-expected financial results of several top companies.
The Composite Index market jumped 7.1 percent – the highest rise in more than 10 months, according to Bloomberg – to close at 1,256.70 points, extending a 5.4 percent and 2.23 percent rallies on Thursday and Wednesday, respectively. This means the index has risen 1 percent this weak.
Head of research at Bhakti Securities Budi Ruseno said Friday the gains were the result of good sentiment in regional markets after the US Fed cut its interest rate by half a percentage point to 1 percent. "The Fed's decision gives global and regional markets good sentiment," he said.
On the domestic front, the good performance of several top companies with big capitalizations in the market over the first nine months this year also helped push up the main index.
Among those are the country's biggest publicly traded company by sales, PT Astra International, whose nine-month profit rose 61 percent due to higher car and motorcycle sales and an increase in palm oil prices. Its shares soared 19.87 percent to Rp 9,350 (8.6 US cents).
Another big gainer is the country's third largest bank by assets, Bank Rakyat Indonesia (BRI), whose shares skyrocketed 18.97 percent to close at Rp 3,450, following announcement that its nine-month profit jumped by 17 percent to Rp 4.2 trillion.
Bank Danamon, the fourth largest lender, and Bank Mandiri, the largest, gained 18 percent and 20 percent respectively to close at Rp 2,600 and Rp 1,560.
Heavy equipment company United Tractors rose 20 percent to Rp 3,150, after it announced another solid third quarter performance. State gas distributor PT Perusahaan Gas Negara (PGN) climbed 15 percent to Rp 1,400.
Overall, Friday's trading saw 116 shares rise, 52 decline and 43 unchanged.
Budi also said the stock market authority to change the upper limit of shares trading to 20 percent, from 10 percent initially, helped the shares to move forward. The regulator retained the lower limit of trading at 10 percent.
When asked about the projection of trading next week, Budi said the positive mood would still cloud the market, with the index estimated to range between 1,150 and 1,330.
Among events to be watched domestically is the release of the inflation rate Monday by the Central Statistics Agency (BPS) and a decision on interest rates by the central bank. At present, the central bank's key interest rate stands at 9.5 percent.