Market Flash: iSHARES MSCI Indonesia Investable Market Index Fund (EIDO:US) PRICE: 28.530 USD Down -0.360 (-1.246%) >>> BI: Rupiah Melemah Akibat Kondisi Eropa >>> Pertemuan FED pertimbangkan langkah baru dorong ekonomi >>> KIJA akan Terbitkan MEN Valas USD150 Juta >>> PT Indika Energy Perusahaan Teladan Dunia 2011 >>> Govt Promises Revision of Cost Recovery Regulation >>> BPMigas Demands PGN to Pay US$6 per MMBTU >>> Jababeka to Raise US$150 Million from Debt Markets >>> SCG Chemicals buys Chandra Asri >>> Solusi Tunas eyes Rp380 bio IPO >>> SMR Utama scouts Rp300 bio IPO >>> Alam Sutera picks two bond arrangers >>> ASII Tetap Rajai Penjualan Mobil Agustus 2011 >>> Perusahaan Thailand kuasai Saham TPIA senilai Rp 3,76 Triliun >>> Agis Main ke Tambang, Sahamnya Masuk Dalam Pengawasan >>> ACES Mendekati The Northern Agar Mau Kurangi Kepemilikan >>> IHSG masih harus berjuang terus bertahan diatas MA200 >>> Melirik Peluang Akumulasi di Saham Perbankan >>> Analisa Saham BUMI: Kuat Bertahan & Berpeluang Kembali Uptrend >>> Analisa Saham JSMR: Bertahan Di Support, What Next? >>> INDF Tertahan Di Area Support Kuat, Berpeluang Rebound >>> ASII Break Minor Support, Sell on Strength >>> ADRO Membentuk Descending Wedges, Berpeluang Rebound Terbatas >>> Wall Street ends flat as early gains evaporate >>> Fed begins policy meeting, tiptoes toward easing >>> Fed meeting to help decide on long-term Treasuries >>> Greece Makes 'Good Progress' in Reform Talks: EC >>> China worried Europe debt crisis will hit trade >>> China could roll out 4.65tr yuan stimulus package >>> IMF sees Mideast stagnation >>> NYMEX-Crude ends higher at Oct contract expiry >>> Asian Crude Palm Oil Up On Technical Buying, Soyoil >>> Foreign net Sell - 61.785.746

Kamis, 25 Agustus 2011

Stocks in U.S. Rise After Durable-Goods Orders, Home Prices Beat Estimates Bloomberg

U.S. stocks rose, extending the biggest rally for the Standard & Poor’s 500 Index in a week, after reports on durable-goods orders and home prices beat economists’ forecasts and banks advanced.

Financial stocks in the S&P 500 rose 2.8 percent, the biggest gain within 10 industries. Bank of America Corp. (BAC) surged 11 percent as Meredith Whitney, who predicted Citigroup Inc. (C)’s dividend cut three years ago, said it has no urgent need to raise capital. A gauge of 12 homebuilders in S&P indexes added 3.6 percent. Newmont Mining Corp. (NEM) slumped 1.6 percent after gold futures plunged the most since 2008 as demand for havens waned on speculation financial markets may be stabilizing.

The S&P 500 rose 1.3 percent to 1,177.60 at 4 p.m. in New York. The durable-goods data wiped out a 1.4 percent retreat in futures on the index. The Dow Jones Industrial Average added 143.95 points, 1.3 percent, to 11,320.71.

“Any time you see life in the walking dead, it certainly makes you feel a lot better,” Bruce McCain, who helps oversee $22 billion as chief investment strategist at the private- banking unit of KeyCorp in Cleveland, said in a telephone interview. “There’s so much pessimism priced into the market that if we get any decent news, it’s going to buoy investors’ spirits. If investors can be reassured that a disaster is not imminent, that’s good for the market.”

With traders awaiting a speech on Aug. 26 by Federal Reserve Chairman Ben S. Bernanke in Jackson Hole, Wyoming, trading is being affected more than usual by levels monitored by so-called technical analysts who base forecasts on price and volume history. Read More ...

Strong durable goods data ease recession fears - Reuters

(Reuters) - New orders for long-lasting U.S. manufactured goods rose in July, offering hope the ailing economy could dodge a second recession even though a gauge of business spending fell.

Durable goods orders jumped 4 percent, the Commerce Department said on Wednesday, as demand for autos and airplanes surged, more than erasing June's 1.3 percent drop. The rise was double economists' expectations.

"This report offers some encouragement that overall manufacturing production may not have fallen entirely out of bed," said Millan Mulraine, a senior macro strategist at TD Securities in New York. "The economy will likely avoid a recession, barring any outside shock."

But non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending, fell 1.5 percent after rising 0.6 percent the month before.

Economists noted this so-called core capital goods category tends to be weak in the first month of a quarter and were encouraged that shipments of these goods, which go into the calculation of gross domestic product, had risen despite the fall in new orders.

Since July, however, stock prices have dropped sharply and consumer confidence has taken a hit, suggesting the report on durable goods -- items from toasters to aircraft meant to last three years or more -- could be offering a rosier view of the economy than currently warranted.


In Germany, business confidence posted its steepest drop this month since the aftermath of the Lehman Brothers collapse in late 2008, raising fresh doubts about the broader European economy as it grapples with a crippling debt crisis.

Similar concerns hold in the United States.

"There is legitimate fear that businesses will shelve expansion plans and signs of such behavior are evident in the August business surveys," said Aaron Smith, a senior economist at Moody's Analytics in West Chester, Pennsylvania.

The data helped stocks .SPX on Wall Street to rack up strong gains for a second day. Prices for U.S. government debt fell sharply, while the dollar .DXY rose modestly across the board.

Federal Reserve Chairman Ben Bernanke is expected to nod to the stock market turmoil and weak confidence in a speech at an annual central bank conference in Jackson Hole, Wyoming, on Friday.

He is unlikely to offer plans for a new round of bond purchases, but he may hint at a possible tweaking of the U.S. central bank's balance sheet to put further downward pressure on medium- and long-term interest rates.

Regional manufacturing surveys for August to date have shown a sharp drop in activity, raising the risk the nation's factory sector may have stalled this month.

The Institute for Supply Management's index of national manufacturing activity stood at 50.9 in July. Economists said it would likely fall below 50 in August, indicating contraction.

The index has been steadily declining since March, but that weakness had been blamed mainly on supply chain disruptions from Japan due to the massive earthquake there in March. The August survey will be published on September 1.


Durable goods orders last month were buoyed by a 14.6 percent jump in bookings for transportation equipment, which was the largest increase since January.

That reflected a 43.4 percent surge in aircraft orders and an 11.5 percent spike in motor vehicle bookings. The increase in auto orders was the largest since January 2003 and indicated disruptions wrought by the Japan earthquake were fading.

Economists expect motor vehicle production to support growth in both the third and fourth quarters, and help the economy avoid another recession.

"The automotive sector will be a positive for GDP in the third and fourth quarter," said Michael Montgomery, a U.S. economist at IHS Global Insight in Lexington, Massachusetts. "We are sort of skating along the edge."

Boeing (BA.N) received 115 aircraft orders, 100 of those from American Airlines (AMR.N), according to information posted on the plane maker's website. That was up from 48 in June.

Excluding transportation, orders rose 0.7 percent after gaining 0.6 percent in June.

Manufacturing has been a key pillar of the U.S. economy's recovery and erosion of that support would be particularly bad given that housing, which has shouldered previous recoveries, continues to struggle.

Demand for loans to buy homes slumped to a nearly 15-year low last week, blamed largely on the stock market turmoil.

A separate report from the Federal Housing Finance Agency showed home prices rose 0.9 percent in June from May. However, they were down 4.3 percent from a year ago, and other reports have shown prices slipped in July.

Luxury home-builder Toll Brothers Inc (TOL.N) on Wednesday reported tepid growth in orders in the third quarter and a rise in cancellations. It said stock market volatility and economic uncertainty continued to weigh on home buyer confidence.

Gold prices plunge as economic fears ease, for now - AP

Gold prices plunged 5.6 percent Wednesday as investors grew more confident about the global economy.

Gold dropped $104 to finish at $1,757.30 an ounce. It was the steepest percentage drop since March 2008. Gold is still up 24 percent for the year.

Investors have been buying gold because of concerns about economic weakness in the United States and Europe as well as a stretch of severe volatility in financial markets that began in early August.

Recent economic news has been more encouraging. The government said Wednesday that orders rose 4 percent in July for long-lasting goods such as cars and aircraft, the biggest increase since March. Retail sales and industrial production were also better last month.

The improvement in economic news, combined with higher stock prices this week, eased investors' jitters. In the past two days investors have sold gold following its recent run-up.

Gold is seen a relatively stable investment that investors use as a hedge against losses in other holdings, especially when the economy seems weak and financial markets are volatile. Gold has been climbing at a record-setting pace, reaching $1,900 an ounce for the first time on Monday. Gold is still below the level it reached in 1980 after adjusting for inflation.

Unlike stocks or bonds, gold doesn't pay any interest or dividends, nor does it represent ownership in a company. Its value is strictly tied to what investors are currently willing to pay for it. And that, says Cetin Ciner, a professor of finance at the University of North Carolina-Wilmington, is exactly where the problem lies.

"When you have something so subjected to investor psychology, you can see extreme reactions," Ciner said.

Some analysts believe gold prices have been climbing so high, so fast that it was time for a correction. "I think it was overbought, yes. I think the rally was too quick during a short amount of timespan," CPM Group analyst Carlos Sanchez said.

In other trading, energy and metals products were mixed while wheat, corn and soybeans fell. One factor was a stronger dollar. Since commodities are priced in dollars, a stronger dollar makes them more expensive for buyers who use other currencies.

Silver for September delivery fell $3.129, or 7.4 percent, to finish at $39.162 an ounce, September copper rose 0.2 cent to $3.998 a pound, October platinum fell $53.80 to $1,826.30 an ounce and September palladium fell $21.25 to $743.15 an ounce.

Benchmark crude oil for September delivery fell 28 cents to end at $85.16 per barrel on the New York Mercantile Exchange.

In other Nymex trading, heating oil rose 1.98 cents to $2.969 per gallon, gasoline futures increased 0.86 cent to $2.7558 per gallon and natural gas fell 7.1 cents to $3.922 per 1,000 cubic feet.

December wheat fell 7.25 cents to end at $7.7725 a bushel, December corn declined 0.5 cents to $7.43 a bushel and November soybeans fell 3.75 cents to $13.935 a bushel.

AP Business Writer Bernard Condon contributed to this report.

Stocks Climb in Europe on Better-Than-Estimated U.S. Durable-Goods Orders - Bloomberg

European stocks climbed for a third day after a report on U.S. durable-goods orders beat forecasts amid ongoing speculation that the Federal Reserve will act to bolster the economy.

Daimler AG (DAI) and Fiat SpA (F) led a gauge of automakers to the biggest gain in 13 months. Ageas, the majority owner of Belgium’s largest life insurer, surged 21 percent after announcing a buyback. WPP Plc (WPP), the world’s largest advertising company, advanced 7.4 percent as profit beat estimates. Heineken NV (HEIA), the world’s third-biggest brewer by volume, tumbled the most since 2003 after saying earnings are unlikely to grow this year.

The Stoxx Europe 600 Index rose 1.4 percent to 229.79 at the 4:30 p.m. close in London, extending the advance from the two-year low reached at the end of last week to 3 percent. The gauge has still fallen 21 percent from this year’s peak on Feb. 17 as European and U.S. economic data that trailed economists’ forecasts added to concern the global recovery is at risk.

“Everyone is waiting for Friday’s meeting of the Federal Reserve,” said John Plassard, a director at Louis Capital Markets in Geneva. “Until then, every bit of good news, such as the strong durable-goods numbers, will support the markets.”

Central bankers are meeting this weekend in Jackson Hole, Wyoming. At last year’s event, Fed Chairman Ben S. Bernanke’s hint of a second round of asset purchases, or quantitative easing, spurred a 28 percent jump in the Standard & Poor’s 500 index through April. Read More ...

QE3 is Unlikely: Ex-Council of Economic Advisors Chairman CNBC

It's doubtful Ben Bernanke, chairman of the Federal Reserve, will unveil another round of quantitative easing [cnbc explains] during his speech later this week in Jackson Hole, Wyoming, said Glenn Hubbard, dean and Russell L. Carson professor of finance and economics at Columbia Business School, and former chairman of the Council of Economic Advisors.

"I'd be very surprised if there was a radical QE3," Hubbard told CNBC Wednesday.

"The risk management argument really isn't there. There are data to be learned about the economy. The affect of a QE3 would be relatively modest, and it might risk raising inflationary [cnbc explains] expectations, so I doubt it."

Hubbard noted the real issue is more for the U.S. government than the Federal Reserve [cnbc explains] . "The government really needs to get its fiscal house in order and help support the economy. That's really not something the Federal Reserve can do."

President Obama needs to come up with a "good package for the economy" with a lot of long-term budget adjustment and spending restraint, and perhaps something that's going to help the economy today, he explained.

"Some candidates could be a corporate [tax] rate cut, investment incentives, higher incentives on the employer side," added Hubbard. "Whether the President will propose those is anyone's guess."

Rabu, 24 Agustus 2011

Some Gold Bulls Say Time to Cash In, Rally Overdone - CNBC

As gold prices near $2,000 an ounce, some bulls say its time take money off the table after the safe-haven rally extended too far too fast in recent weeks.

Gold investors at several firms said that gold prices could correct sharply, citing overvaluation. While that does not mean prominent bulls are now bears, they recommended investors take profit on gold holdings, after the precious metal traded briefly above $1,900 on Tuesday for the first time.

Spot gold [XAU= 1846.96 17.31 (+0.95%) ] quickly recoiled to end down more than 3 percent on Tuesday, its biggest daily fall in a year and a half, having advanced by almost 8 percent in just the last three sessions and by more than $400 since July.

Independent investor Dennis Gartman, who has long been bullish on gold priced in non-U.S. currencies, said he was reducing his long positions on gold priced in euro and sterling terms.

"Perhaps things have become a bit too frothy and reduced rather than increased exposure seems reasonable and wise," Gartman said.

Gartman said gold's rally was not sustainable after SPDR Gold Trust's [GLD 177.67 -6.92 (-3.75%) ] total assets surpassed that of the SPDR S&P 500 ETF, making GLD the largest exchange-traded fund in the world for the first time.

"Such things senseless happen after periods of euphoric rises in prices of some markets," Gartman said.

In a note on Tuesday, UBS Metals Strategist Edel Tully said that the Swiss bank "has certainly noticed an increase in clients looking to book profits."

Tully also cautioned that the risk of more margin hikes from CME Group [CME 250.37 11.15 (+4.66%) ] was rising, after the U.S. commodity exchange raised margins by 22 percent earlier in August.

Buy the Rumor, Sell the News?

Investors in droves have sought a refuge in bullion from a stock market meltdown, fears about sovereign debts in Europe and the United States and worries about a recession.

Fund managers said the metal was bid up as an inflation hedge on expectations of further U.S. monetary easing, and bullion could sell off if Federal Reserve Chairman Ben Bernanke does not announce a new bond-buying stimulus program at an annual Fed conference in Jackson Hole, Wyoming on Friday.

"There is some potential degree of 'Buy the rumor, Sell the news' on any future Fed policy that may come out at Jackson Hole. Investors might want to have that on the back of their minds as well," said Michael Cuggino, portfolio manager of the $15 billion Permanent Portfolio Funds.

"Gold being as volatile as it is, it can go down in $100 to $200 and not really blink an eye," Cuggino said.

Analysts said anything short of a third round of quantitative easing would likely provide limited support for gold as the Fed had already vowed to keep interest rates low into 2013.

Cuggino said that investors should stay put and not add new gold positions at current prices, even though the metal is still a safe haven and an integral part of an investment portfolio in longer term.

Mark Luschini, chief investment strategist at Janney Montgomery Scott, a broker-dealer with $54 billion in assets, said that on charts, gold is vulnerable for a sharp pullback as it is trading at $400 above its 200-day moving average, a sign of overbuying.

"From a purely technical standpoint, I think it'd be wise to take some chips off the table," Luschini said.

Bukit Asam to Acquire 30% Shares in Adani Global's Coal Railway Project - The Indonesia Today

State coal miner PT Tambang Batubara Bukit Asam (PTBA) Tbk will absorb 30% shares in the coal railway project planned by Adani Global in South Sumatra, Kontan business paper reported.

PT Adani Global, a subsidiary of Adani Enterprises, plans to build coal railway with US$1.8 billion investment in South Sumatra. Adani currently controls 97.5% shares, with the balance owned by South Sumatra provincial administration.

"We're advised to take 30% shares in the project. We will subscribe the shares of PT Adani Global," said Achmad Sudarto, corporate secretary of Bukit Asam.

Bukit Asam might have to inject US$162 million to get 30% shares in PT Adani Gobal. Source of funds will mainly be internal sources.

The coal railway will connect Tanjung Enim and Tanjung Api-Api port through a 270-Km line. Adani expects to start construction next year and in operation by 2014.

Indofood H1 Profit Soars 42% - The Indonesia Today

Giant food processor PT Indofood Sukses Makmur (INDF) Tbk booked net profit of Rp2.55 trillion in the first half of 2011, soared 42% from the corresponding period last year.

Indofood reported sales revenue of Rp21.8 trillion in the first six months of 2011, representing an increase of 14% over the same period last year. But as cost of goods sold surged 27% to Rp15.5 trillion, Indofood's gross profit actually increased only slightly by 7.5%.

Indofood, however, managed to cut some operating costs, resulting in a 16.8% growth in operating profit to Rp3.48 trillion.

Combined with lower financial costs, Indofood then posted 42% jump in net profit to Rp2.55 trillion or an EPS of Rp180.

Indofood shares closed at Rp6,750 Tuesday (August 23). The stock has gained about 35% year-to-date.

Moody's Cuts Japan Rating One Notch to Aa3 - CNBC

Moody's Investors Service on Wednesday cut the rating on Japan's government debt by one notch to Aa3, blaming large budget deficits and the build-up of debt since the 2009 global recession.

The agency had warned in May that it may downgrade Japan's Aa2 rating due to heightened concerns about its faltering growth prospects and a weak policy response to deal with a bulging public debt, now twice its $5 trillion GDP.

"Several factors make it difficult for Japan to slow the growth of debt-to-GDP and thus drive this rating action," Moody's said in a statement, adding that the March 11 earthquake and ensuing nuclear crisis had exacerbated Japan's problems.

Still the ratings agency said the outlook was now stable given the "undiminished home bias of Japanese investors and their preference for government bonds, which allows the government's fiscal deficits to be funded at the lowest nominal rates globally."

The yen moved little on the news, trading at around 76.7 against the dollar.

The downgrade brings Moody's rating for Japan in line with rival agency Standard & Poor's, which cut the country in January to AA, the fourth highest on its scale.

Persistent deflation and slow growth has shackled Japan's economy for years, reducing tax revenue available to the government, which has grown to rely on debt issuance to finance a large portion of its budget.

Bove: I Changed My Mind, Buy the Bank Stocks - CNBC

Banking analyst Dick Bove, who a month ago rocked the markets with his call to sell everything in sight, has changed gears.

Now, Bove is advising to buy.

With both hands.

“In the last few days I started looking at valuations of these companies and was just shocked by what I saw,” said the Rochdale Securities vice president of equity research. “These stocks are selling in many cases at lower valuations than the first quarter of 2009, which was supposedly the bottom.”

So why the change of heart?

In part, it stems from the very irrational market behavior he cited when first delivering his sell admonition in late July.

The same investors who are selling stocks in banks are taking the proceeds and sticking them right back into the very banks whose stocks they are selling.

In the past two weeks, that has come to the tune of $200 billion in new deposits for banks whose capital continues to be in question as the economy slides, rates stay near zero and capital requirements rise.

Bank of America [BAC 6.30 -0.12 (-1.87%) ], for instance, is sitting on $140 billion in cash, more than its total tangible book value, yet its market cap is $65 billion. The company’s stock has slid more than 30 percent in the past month.

“What the market is saying is that this thing isn’t even worth its liquidation value when its liquidation value is in cash,” Bove said in an interview.

Bank of New York Mellon [BK 19.50 0.61 (+3.23%) ] is in a similar situation and “you can play the same game at Citigroup [C 27.32 1.26 (+4.83%) ], Northern Trust [NTRS 36.21 1.11 (+3.16%) ], State Street [STT 33.07 1.30 (+4.09%) ],” he said.

“What you have at the moment is the market making the assessment that these companies aren’t even worth their liquidation value, if their liquidation value is 100 percent cash,” he said. “You have to ask yourself what is going on.”

Bove said the more than 20 percent slide since he made his sell call—effectively a trip into bear market territory for the sector—is enough.

“The stocks came down 22 percent. So then you have to say, what are these stocks worth now?’” he said. “Is there any example of a market collapse when there’s $200 billion that flows into the banking system in a two-week period? Can the economy really become unstuck when it’s drowning in excess liquidity? It doesn’t make sense.”

Hopes for another Fed rescue drive 3 percent rally on Wall St - Reuters

NEW YORK (Reuters) -Stocks shot 3 percent higher on Tuesday on speculation Federal Reserve Chairman Ben Bernanke this week would signal new help for the economy, giving investors hope a four-week rout was nearing an end.

Weak data in housing and regional factory activity triggered the latest round of bets that Bernanke will act, even though the Fed's options appear limited. Bernanke speaks to a central bank conference on Friday in Jackson Hole, Wyoming.

"I don't think anybody wants to be too short or negative in front of Bernanke's speech," said Jim Awad, managing director at Zephyr Management in New York.

The Dow Jones industrial average was up 322.11 points, or 2.97 percent, at 11,176.76. The Standard & Poor's 500 Index was up 38.53 points, or 3.43 percent, at 1,162.35. The Nasdaq Composite Index was up 100.68 points, or 4.29 percent, at 2,446.06.

Technology and other growth stocks drove much of the gains, with the Nasdaq rising more than 4 percent. The sharp rise echoed the wild swings the market experienced two weeks ago after Standard & Poor's downgraded United States' long-term credit.

Volume was a solid 9.35 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq. The daily average for last year was about 8.47 billion.

Even financials, which had been knocked lower earlier by shares of Bank of America, ended positive, with the S&P Financials Index up 3.2 percent.

Bank of America Corp remained under pressure on fears of possible write-offs and the need for capital. Its stock fell 1.9 percent to $6.30 but well off the day's lows.

More than 561 million shares traded in Bank of America, accounting for nearly 6 percent of overall composite volume for the exchanges.

The market has been battered by concerns of another U.S. recession and the worsening euro zone debt crisis.

"This is how the start of a rally in an oversold market usually looks like: an aggressive short-term gain like today," said Jack De Gan, chief investment officer at Harbor Advisory Corp in Portsmouth, New Hampshire, suggesting the market may have hit the bottom.

The rally briefly stalled in the afternoon on news of a magnitude of 5.9 earthquake, which struck in Virginia and forced some building evacuations along the U.S. East Coast and Canada, but no major damage or injuries were reported.

Big percentage gainers on the S&P included technology shares Nvidia Corp and JDS Uniphase Corp, both rising about 10 percent.

Among financial stocks, American Express Co and JPMorgan Chase & Co were the top gainers on the Dow. American Express shares rose 4.1 percent to $46.42, while JPMorgan shares advanced 4.1 percent to $34.78.

On the NYSE, advancers beat decliners by a ratio of about six to one, while on the Nasdaq, about five stocks rose for every one that fell.

(Reporting by Angela Moon, Editing by Kenneth Barry)

Scrapping Regulations Will Save Businesses $10 Billion - CNBC

The Obama administration revealed plans Tuesday to cut or roll back hundreds of federal regulations, saying it hoped to save businesses $10 billion and spur job growth.

The move, announced while President Barack Obama was on vacation in Martha's Vineyard, was the latest White House gesture to reach out to a business community that has often felt alienated from the administration. But the move was criticized in some private sector quarters as too little, too late.

"The administration's findings and determinations, on their own, are a worthy effort at making technical changes to the regulatory process, but the results of this look back will not have a material impact on the real regulatory burdens facing businesses today," said Bill Kovacs, senior vice president at the U.S. Chamber of Commerce.

Administration officials said the plans unveiled Tuesday include 500 regulatory reforms, including more than 100 from the Department of Transportation and more than 70 from the Department of Health and Human Services. Once the reforms are fully implemented, the administration estimates businesses will save about $10 billion over five years.

Cass Sunstein, head of the White House Office of Information and Regulatory Affairs, said the savings for businesses will give the private sector an opportunity to create new jobs. But Sunstein said he had no estimates on how many jobs could be created as a result of regulatory reforms.

Many of the regulatory reforms are designed to help small businesses, the administration said. Those include accelerating payments to as many as 60,000 small businesses that have contracts with the Department of Defense, and requiring the Small Business Administration to adopt a single electronic application in order to reduce paperwork burdens.

House Majority Leader Eric Cantor, R-Va., said the administration's announcement was "underwhelming." And the Chamber of Commerce said real regulatory reform should include permit streamlining and reforms that would make it easier for businesses to get environmental clearance to start projects.

Obama called for federal agencies to scrutinize their existing regulations after his party suffered sweeping losses in the 2010 elections. The president acknowledged at the time that his relationship with the business community had soured, and he vowed to scrap "dumb" rules that were hindering private sector growth.

Sunstein said the reforms would not impact regulations needed to protect consumers and the environment, including rules used by the Federal Aviation Administration to ensure safe air travel and by the Department of Agriculture and Food and Drug Administration to protect food safety.

Copper prices push up on Bernanke, China imports - Commodity Online

MUMBAI (Commodity Online): Copper futures rose on speculation that the US will take measures to boost the economy as the investors eye Fed Chairman Ben Bernanke’s speech later this week at Jackson Hole. The US is the world’s second largest copper consumer.

At the Multi-Commodity Exchange of India (MCX), copper August contract is up by 1.22% as of evening trade on Tuesday whereas at the London Metal Exchange (LME), copper for 3 month delivery rose 1.4%.

“The important news this week will be obviously Bernanke’s speech in Jackson Hole. That’s what people are waiting for”, said Andrey Kryuchenkov, an analyst at VTB Capital in London, Bloomberg reported.

The Fed chairman had earlier hinted that that the US might embark on a second round of asset purchases. The Fed had earlier bought $600 billion worth treasuries during November to June.

Import data from China, the world’s largest Copper consumer, has also supported the market. Customs data showed that imports of scrap and refined copper had risen in July with scrap imports at their highest level since December 2010.

“Imports were better than a month before, and that’s slightly positive,” Kryuchenkov said. “We’re still trading on pretty much macro news.”

GEOJIT Comtrade view:
MCX Copper August: Dips to 396 to hold for 405/409 now, a direct fall below 394 could dent this bullish view.
S1 394 S2 387 R1 410.60 R2 421

Crude Palm Oil At One-Week High On Soyoil, Export Demand - PalmOil HQ

Crude palm oil futures on Malaysia’s derivative exchange rose to a one-week high Tuesday amid expectations for strong exports in August as external markets provided supportive cues.

Benchmark November CPO on the Bursa Malaysia Derivatives rose as much as 1.6% to MYR3,070 a metric ton, the benchmark's highest level since Aug. 15, and ended at MYR3,068 a ton, up 1.5% from Monday's settlement.

Some trade participants said tight prompt supplies of the cooking oil underpinned market.

"Production [of palm oil] is not coming in…while likely higher demand for the next two months may reduce stock levels," said a trading executive at a Kuala Lumpur-based foreign brokerage.

Planters said August production may slip 2% from July's level of 1.95 million tons, as workers go on holidays next week for the Eid ul-Fitr celebration at the end of the Islamic fasting month.

The market may rise toward the psychological level of MYR3,100/ton within the next few days as investors continue to cover short positions ahead of the holidays, said a commodities analyst in Jakarta.

But gains may be capped due to the higher margin requirements for palm oil contracts set by the BMD from Aug. 25 to manage volatility next week.

"The rise in margin rates may provide an excuse for some investors to book profits," said a commodities broker at a Kuala Lumpur-based brokerage.

The exchange raised margin rates for the spot month to MYR8,750 per contract from MYR7,250, Bursa Malaysia also raised non-spot margins to MYR8,500 from MYR7,000 for contracts that remain open at the close of business on Thursday.

In the cash market, refined palm olein for April/May/June changed hands at $1,087.50/ton and $1,092.50/ton, free-on-board Malaysian ports, said a physical market broker in Singapore.

Cash CPO for prompt shipment was offered MYR35 higher at MYR3,165/ton.

Traded volume on the BMD reached 21,871 lots, up from 11,900 Monday. One lot equals 25 tons.

Open interest was 127,134 contracts compared with 128,392 contracts Monday.

Adaro 'Caplok' Mustika Indah US$ 222,5 Juta - Detikfinance

Jakarta - PT Adaro Energy Tbk (ADRO) melakukan akuisisi terhadap 75% saham PT Mustika Indah Permai (MIP) melalui anak usahanya PT Alam Tri Abadi. Nilai investasi mencapai US$ 222,5 juta.

Menurut Presiden Direktur ADRO Garibaldi Thohir, akuisisi ini dilakukan dari pemilik sebelumnya, Elite Rich Investment Limited.

"Investasi di MIP merupakan bagian dari upaya kami untuk menciptakan nilai tambah yang berkelanjutan dari batubara Indonesia," ungkapnya dalam rilis yang dipublikasikan di Jakarta, Selasa (23/8/2011).

Dengan akuisisi MIP akan mendukung pertumbuhan organik perseroan dan akan mencapai kapasitas produksi 80 juta ton dalam jangka menengah. MIP merupakan perusahaan pertambangan batubara di Sumatera Selatan dan masih dalam tahap pengembangan proyek batubara greenfield.

MIP adalah pemegang IUP (izin usaha pertambangan) selama 20 tahun yang berlaku sejak April 2010, dengan luas area 2.000 ha.

"Para penasihat dan tenaga ahli Adaro Energy telah mengunjungi lokasi proyek di November 2010 dan kemudian melakukan program geologi dan pengeboran. Setelah proses tersebut dan studi menyeluruh lainnya dilakukan, ADRO memutuskan untuk mengakuisisi kepemilikan mayoritas di MIP," tuturnya.

Marston, selaku konsultan pertambangan internasional telah melakukan studi rekayasa atas potensi batubara yang menjadi dasar valuasi untuk proyek tersebut.

"Adaro telah membuat sejumlah lubang bor sebagai bagian dari due diligence untuk memastikan ketebalan struktur dan kualitas dari lapisan batubara yang memiliki potensi untuk ditambang sebelum menyelesaikan pembelian," imbuhnya.

Astra Agro 7M CPO sales rises 20.1% - Insider Stories

Palm oil producer PT Astra Agro Lestari Tbk (AALI) today reports a 20.1% increase in CPO sales in the first 7 months of this year.

Astra Agro's CPO sales volume was 688,888 tons in 7M2011 from 573,608 tons in 7M2010. Of the total CPO sales volume, approximately 95.7% or 659,340 tons were absorbed by local market, while the remaining volume of 25,548 tons by export market.
The average CPO selling price of AALI in 7M 2011 was Rp7,868/kg, a 19.9% increase compared to the same period last year.

Meanwhile, sales volume of kernel in this period went up by 40% to 81,159 tons with the average selling price of Rp5,818/kg from 57,991 tons.

Semen Gresik Segera Operasikan Dua Pabrik Baru - Republika

REPUBLIKA.CO.ID, SURABAYA - PT Semen Gresik Tbk segera mengoperasikan dua pabrik baru masing-masing berkapasitas 2,5 juta ton di Tuban, Jatim, dan Pangkep, Sulawesi Selatan, pada akhir 2011 dan awal 2012.

Sekretaris Perusahaan PT Semen Gresik Tbk, Sunardi Prionomurti, ketika dihubungi di Surabaya, Selasa (23/8) mengatakan, proses pembangunan kedua pabrik itu berjalan sesuai jadwal dan saat ini sudah mencapai hampir 90 persen.

"Pabrik Tuban direncanakan sudah beroperasi akhir tahun ini, sementara pabrik di Pangkep (Semen Tonasa) dijadwalkan kuartal pertama 2012. Total akan ada tambahan produksi lima juta ton dari kedua pabrik itu," katanya.

Menurut Sunardi, pembangunan kedua pabrik itu merupakan upaya SG untuk mengejar produksi 28,7 juta ton pada 2015 dan mengantisipasi permintaan semen dalam negeri yang terus meningkat.

Saat ini, kapasitas produksi SG sekitar 20,2 juta ton per tahun atau sekitar 40 persen dari total produksi nasional. Sedangkan konsumsi semen dalam negeri diprediksi sekitar 47 juta-48 juta ton pada tahun ini.

"Permintaan semen hingga 2015 diperkirakan mencapai lebih dari 56 juta ton. Kalau tidak ada penambahan pabrik baru di dalam negeri, dikhawatirkan terjadi krisis semen," ujarnya.

Selain dua pabrik di Tuban dan Pangkep, SG juga berencana membangun pabrik baru di wilayah Jawa Tengah dan Sumatera, tetapi masih terkendala masalah lahan.

Terkait kinerja perseroan, Sunardi menambahkan bahwa penjualan SG selama semester I/2011 telah menembus angka 11 juta ton atau sekitar 57 persen dari target 19,5 juta ton.

Target tersebut naik sekitar 8 persen dibanding penjualan 2010 sebesar 17,9 juta ton. "Secara nasional, industri semen nasional tumbuh sekitar 15 persen selama semester pertama tahun ini, jauh lebih tinggi dibanding periode sama 2010 yang hanya sekitar 9 persen. Namun, pertumbuhan sampai akhir tahun diprediksi sekitar 10 persen," tambah Sunardi.

Sims Jaya back door listing via Myoh - Insider Stories

PT Myoh Technology Tbk, a technology information company, plans a back door listing by acquiring coal mining and services PT Sims Jaya Kaltim from Samtan Co Ltd.
In an agenda of extraordinary general meeting submitted to Indonesian Central Securities Depository, Myoh will use proceed from rights issue to support the acquisition.

South Korea's company Samtan owns 49% shareholding in coal miner PT Kideco Jaya Agung, which is also 46% owned by PT Indika Energy Tbk and 5% owned by PT Muji Inti Utama.

However, there is no clear information about the proceed generated from the rights issue. Sims Jaya Kaltim is one of contractors working for Kideco. Sims Jaya's equity is US$2 million. Samtan has partnered with the US-based company Samchully.
Sim Jaya, founded on April 1 2001, is represented by Lim Jae Jung with 528 local and five korean employees. In 2003, the company recorded US$19.19 million revenue and US$1.8 million net profit. Prior to the rights issue, Myoh plans to reverse its outstanding shares. MYOH stocks today surged 14% on the backdoor's plan.

PT International Nickel Indonesia Tbk Potentially Lower ASP Going Forward - AAA

INCO flat performance in 1H11 was due to higher cost related with repairs in its plants post the earthquake. Furthermore, the potential lower ASP in 2012 will make INCO’s share price to remain under pressure. However, with relatively high dividend yield and ROE, the stock is still worth buying. BUY.

± Weak Growth Due to Higher Cost
INCO 1H11 net profit grew only 9% yoy to US$238 mn, in line and accounted for 50% of our full year estimate. But, this was the weakest growth since 2009 due to several factors, i.e. the significant increased in cash cost by 31% yoy to US$9,155/mt and the operating expense that increased 21% yoy. The higher cost were mainly related to repairing the damage in INCO’s plant in Sorowako, South Sulawesi after being stroke by a 6.1 SR earthquake in end of 1Q11. Meanwhile, 1H11 revenue increased by 16% yoy to US$715 mn due to higher ASP of 23% yoy to US$20,052/mt albeit volume was slightly down by 8% yoy to 35,100 mt. In 4Q11, another furnace will go into maintenance and will not be available for production. As such, we foresee a decline in production of 8% yoy to 69,862 mt.

± Potentially Lower ASP in 2012
The price of nickel has a positive correlation with the price of stainless steel, and the price of the latter is also positively correlated with China inflation (see graph on page 3). As China is curbing inflation, the price of stainless steel will ease and so is the price of nickel (as the raw material for stainless steel). On quarterly basis, the ASP has already sunk by 2%. In the global market, both stainless steel and nickel prices have weakened by an average of 3% and 5% respectively in the last 4 months. On the other hand, Karebbe 90 MW hydro power project is 99% to full completion and ready to be operated in 2H11 and could reduce fuel cost portion from 49% in FY11F to 47% in FY12F. However, in our view, the impact of lower ASP in 2012 will be stronger than the overall cost reduction.

± Valuation: BUY at Rp4,300 on cheap valuation, high dividend yield and ROE
We roll forward our valuation to FY12F, with lower TP of Rp4,300 from Rp5,200 previously. Our lower TP is mainly due to 12% lower ASP assumption. Despite the bearish story, INCO’s share is traded at only 9.2x PE of FY12F versus its historical average of 12.0x. Cheap valuation, combined with high dividend yield of 8% and high ROE of 26% are the main drivers for our recommendation. BUY.

BWPT Promising growth = AAA

We initiate our coverage on BWPT with a BUY recommendation on the back of: i) its potential continuous prime age mature trees profile which would ensure higher FFB yield among peers; ii) combining innovation and taking up best practice of plantation management to maximize profitability. We set our target price at 12.4x PE or Rp1,331/share, offering 13% upside potential. BUY.

Sustainable prime age trees
BWPT has enjoyed a high yield of FFB for the last 2 years, with 27.4 and 26.4 ha per tonne. Now, average mature trees are 9.8 years, still on peak producing age of palm oil trees. While onward, immature estate (67% of total planted area) will be gradually converted into mature estate. This, will ensure a continuous high production of FFB until at least the next decade. Not quite up there, new planting plan are intensified until 2014 aiming on around 93,860 ha of mature area by the end of 2018. On our calculation, this would keep the average FFB yield on minimum 22 tonne per ha each year until 2018, still higher than other peers like AALI or LSIP.

Running an effective plantation management
Management combines innovation and remain adopting best practice of plantation management commonly used in the industry. Mechanized plantations, is likely going to be running on BWPT plantation estate in the future. Company confirms running mechanization of harvesting and fertilizing process can improve BWPT’s efficiency cost as well as maximize profitability.

Solid 1H11 result to drive optimist forecast
1H11 results were impressive. Revenue grew 73% yoy, driven by higher sales volume as well as higher average selling price of CPO and PK. Better cost management prolonged in 1H11, resulted on 98.8% yoy gross profit increasing. Our forecast for 2011F revenue is to grow 25% with gross margin rise 66%.

Initiating coverage with BUY recommendation
We derived BW’s fair value with 10-year DCF valuation at Rp1,331/share, implying 12.4x PE 2012F, 7.7% premium to average regional plantation companies. We believe our valuation is justified given its potential growth, high yield and robust profitability margins.

JSMR 1H11: Indonesia’s growth-proxy - AAA

JSMR’s 1H11 came within consensus estimates, backed by healthy traffic volume growth with operating margin in 1H11 maintained at 52% the same level with that of in 1Q11 and in 1H10. While we expect margin will slightly decline in the 2H11 due to higher personnel expenses for holiday seasons, we come up with higher YoY profitability margins this year. We see JSMR as proxy for Indonesia’s growth story. Our 10-year DCF calculation with WACC of 10.1% and LTG of 1% resulted in target price of Rp4,800/ share for JSMR. Maintain our BUY recommendation.

1H11 Results. JSMR reported 1H11 revenue of Rp2.36tn, 12.2% YoY growth, with operating profit of Rp1.22T, +12% YoY, and net profit of Rp752bn,+16% YoY. Results were backed by 12% YoY increase in daily traffic in 1H11 to 2.9mn vehicle, with stable blended tariff per vehicle of Rp4,442 (-1%, YoY) in 1H11. Operating profit grew by 12% YoY to Rp1.2tn, posting a stable YoY operating margin at 52% in 1H11 the same level of 1H10. On QoQ basis, total revenue increased by4.4% to Rp1.2tn, while operating profit by 4% to Rp626bn, and net profit by 2.6% to Rp381bn, with traffic volume of 266mn vehichle, +5% QoQ.

Beneficiary of Indonesia’s growth story. JSMR business traits match well with Indonesia’s ambition to reach annual economic growth of 7-9%. First, JSMR tariff is automatically increased every two years at the amount tied to inflation rate. Second, traffic volume has been insensitive to tariff hike. Third, JSMR is the first toll road operator and investor in Indonesia with major market share. Fourth, JSMR has current ample road capacity to absorb volume growth with constructions portfolio in the pipe-line. Fifth, current improved profitability as a result of economies of scale and cost management. To back up its ambition, in late May this year, the President of Indonesia announced a Master plan for Acceleration and Expansion of Indonesia Economic Development 2011-2015, known as the MP3EI. In this master plan the Government aims to achieve acceleration for growth 7-9% per year. We see a slightly decreasing execution risks, as the Government later, established a committee called a KP3EI to regularly oversee progress, headed by Minister of Coordinating for Economic Affairs. We see increasing contribution of JSMR for the country provision of toll roads basic infrastructure need for economy growth.

UNTR Impressive Result TP Rp 32,700 - AAA

7M11 Komatsu sales reached 5,061 units, driven by high activity of coal mining industry due to remain high and higher global coal price. We revised up our FY11 Komatsu sales from 5,800 units to 8,000 as we see coal mining industry outlook remain robust up to end of year. Mining contracting business (Pama) is the direct beneficiary of robust mining outlook, hence we forecast Pama to deliver 750 OB and 84 mn tons coal extraction. Recent new coal concessions acquisitions (of approximately 250 mn tons reserves) firm the Company target to be the big player of coal miner. We upgrade our price target to Rp 32,700 per share with BUY recommendation (40% upside).

Komatsu Sales: Impressive
UNTR showed an impressive 7M11 Komatsu sales, grew 58.1% YoY to reach 5,061 units. The achievement has exceeded our old assumption of 5,600, and let us to set a new target of 8,000 units to end of 2011. We forecast that Komatsu’s demands remain strong as the global coal price remains robust to end of 2011. The Komatsu market share is 51% in 7M11 and expected to stay at 50% in FY11.

Contract Mining Division: Inline Performance
Pama recorded inline performance result in 7M11. Overburden removal and coal extraction were 441.7 mn bcm (61.7% of our FY11 target of 716 mn bcm) and 47.8 mn tons (55.7% of our FY11 target of 85.7 mn tons), resulting stripping ratio of 9.2x. However, we do some adjustment to OB and coal extraction target to reflect current high stripping ratio. With high mining activities, we expect stripping ratio to stay at 8.9x in FY11 (OB of 750 mn bcm and Coal extraction of 84 mn tons).

Col Mining Division: an-organic grows
Coal mining division delivered 353k tons of coal, 1.5% QoQ decrease compared to previous month due to disappointing performance from DEJ coal production (6.6% QoQ lower). Total coal productions from both concessions represent 56.8% of our FY11 target. Recent coal acquisition firms that UNTR is serious to boost its mining business performance and set the long-term target as on of the big player of coal miner in Indonesia. Currently, UNTR total reserves is estimated 200-250 mn tons (including 40 mn tons from TTA, and 13 mn tons). Long-term target, UNTR expects to have 500 mn tons of reserves through acquisition.

Upgrade Price Target
We set our target price to Rp 32,700 per share to reflect higher than expected 7M11 performance result. Our TP reflects 18.9X implied PER 2012F and 8.9x EV/EBITDA 2012F. Revising-up our FY11 Komatsu sales assumption has affected significant increase to our price target. Our valuation resulted also poised by stronger Rupiah, affect to lower margin (especially in mining contracting business). We set average foreign exchange of Rp 8,700/US$ in 2011 and Rp 8,500/US$ in 2012F (Compared to average Rp 9,000 over the same period). We observes, for every 10% increase in average exchange rate, UNTR net profit will shrank by 20.4% and 12.1% in 2012F and 2013F respectively.

Bumi Minerals: 1H11 result 41% consensus (BRMS, Rp670, Not Rated) - Mandiri

􀂄 Bumi Resource Minerals (BRMS) booked strong bottom line growth to Rp344bn (+96.8%yoy, +48.2%qoq) despite lower equity income from associate company, due to significant lower tax payment (different VAT tax recognition). The result is below consensus estimate.
􀂄 Copper and gold production trimmed in 2Q11 to 146mn lb and 147k oz respectively, due to delay in phase-6 development in Batu Hijau mine site. Yet, it is offset by strong gold ASP growth to US$1,440/oz.According to CEO, BRMS is expected to boost its NNT productions in early 2013 as the phase-6 is finalized.
􀂄 We have no rating on BRMS, currently traded at consensus PER11F-12F 20.2x and16.0x

Bumi Resources: Plan to buy back up to Rp3.9tn (Rp2,600, BUMI, Buy, TP :Rp3,700) - Mandiri

􀂄 In the announcement today, BUMI declared its plan to buy back with a budget up to Rp3.9tn for 3.75% of total outstanding shares or 780mn shares, which implying a maximum share price of Rp5,000/share.
􀂄 This plan will be proposed in the EGM that will be held on 26 September 2011 with the buy back period between September 2011 – September 2013.
􀂄 This plan is part of the company’s strategy in regards to the potential conversion of the existing 2 CB which issued in 2009 amounting of US$375mn and US$300mn, respectively. BUMI is currently holding treasury stock of 412.9mn that has been purchased in 2H08 or represent 2% of the total outstanding shares.
􀂄 Please note that based on the Bapepam regulation no XI.B.2, there’s an option for the company to buy back share outside the regular market trading at the highest average closing price for the last 90 days, which could be a positive sign for the BUMI stock price.
􀂄 Currently we have Buy rating on BUMI which trades at 12.7x-10.8x PER11F-12F

London Sumatra: 1H11 net income beats consensus (61.2% of FY) (LSIP, Rp2,400, suspended) - Mandiri

􀂄 LSIP booked strong growth in its 1H net income of Rp886bn (+112.1%yoy, +25.1%qoq)., which beats consensus estimate (61.2% of FY11F consensus.
Historically, 1H net income represented between 30% and 41% of FY net income since 2005. This is in exception in 2008, where due to slump in CPO prices during 2H08, 1H08 net income represented 52% of FY08.
􀂄 2Q11 net profit of Rp492bn grew by 25.1% qoq. The main reason is LSIP started to apply new corporate income tax (20%) in 1H11, including retroactive of its 1Q corporate income tax. LSIP still applied corporate income tax of 25% in 1Q11. The other Indonesian listed plantation companies would not be able replicate LSIP’s effective corporate Income Tax of 20 % due to LSIP’s corporate structure is different with the others.
􀂄 1H11 CPO sales volume grew by 27.2% yoy to 202,520ton. Rubber sales volume decreased by 24.9% to 7,302 ton mainly due to lower purchased rubber from smallholders. OP seed sales volume grew by 60.7% yoy to 11,8 mn seeds.
􀂄 At Rp2,400, LSIP is traded at PER FY11F and FY12F of 11.2x and 10.7x, respectively.

Bank Jabar Banten: key takeaways from our visit to the branch (BJBR, Rp1,040, Not Rated) - Mandiri

We visited BJB's unit in Majalaya yesterday and below were the highlights:
􀂄 By 19Aug-11 the branch has Rp366bn total assets, total loans of Rp349bn and third party funds of Rp120bn. The inadequacy source of funding is supported by the borrowings from BJB head quarter with lending rate of 9.5%.
􀂄 The loans consist of Microbanking of 21.6%, Consumer of 75%, and Commercial of 3.4%. For micro banking, the average loan is Rp10mn effective rate of 27% and loan for commercial is above Rp500mn. Majalaya is a growing textile industry area, and there is a potential for micro banking to growing rapidly.
􀂄 This branch reported a low NPL per 19Aug-11 at 0.8%. The highest NPL come from micro loan of 2%.
􀂄 BJB Majalaya branch is managing 3 sub branches around Majalaya, which are Majalaya sub-branch, Dayeuh Kolot, and Ciparay. Each sub-branch could obtain incremental loans of Rp1.2bn/month with 80 new debtors.
􀂄 We were also visiting one of micro customer, the business engaged in convection industry named Aura Konveksi with total sales of Rp50mn/month and net margin profit of 30%. Aura Konveksi borrowed Rp50mn last year and monthly installment of Rp2.15mn/month for 2 years.
􀂄 Today the stock is trading at 2012PER of 8.3x and PBV of 1.7x. We have no rating on this counter.

Selasa, 23 Agustus 2011

Faith Mount Divests 6.95% Intiland Shares - The Indonesia Today

Faith Mount Investment Limited had in August 16 sold 720.34 million shares of property developer PT Intiland Development Tbk (DILD), representing 6.95% of its enlarged capital.

Other undisclosed shareholder had also in same date sold 9.2% DILD shares. Both transaction was made through negotiated market.

Archid Notopradono, DILD's director, said the divestment by its shareholders will not change the company's focus and performance this year.

"We are still on track for the second half of 2011 by completing some existing projects," he was quoted by Investor Daily.

Intiland allocates capital expenditure (capex) of Rp1 trillion for this year, of which Rp300-400 billion had been spent in the first half.

Bumi Allocates Rp3.9 Trillion for Share Buyback - The Indonesia Today

Giant coal miner PT Bumi Resources Tbk (BUMI) announces on prospectus today it plans to buy back 780 million shares, representing 3.75% of its enlarged capital from market.

It allocates Rp3.9 trillion fund for share buyback, which aims to provide flexibility in raising equity linked debt such as convertible bonds.

The company will hold extraordinary general meeting (EGM) of shareholders in September 26, 2011 for gaining approval on the plan.

After buyback program, the outstanding issued shares will decline to 19.52 billion shares from current 20.3 billion. Bumi's assets will fell to US$7.61 billion and equity will total US$921.09 billion.

London Sumatera H1 Profit Doubled - The Indonesia Today

Plantation company PT Perusahaan Perkebunan London Sumatera Indonesia Tbk (LSIP) posted net profit of Rp886.39 billion in the first half (H1) of 2011, surged 112% from Rp417.78 billion in the same period of last year.

It recorded earning per share (EPS) of Rp130, compared to Rp61 a previous year.

Sales increased 52% to Rp2.38 trillion from Rp1.57 trillion a year earlier while cost of good sold rose 36.9% to Rp1.12 trillion from previous Rp816.04 billion.

Gross profit was Rp1.27 trillion while operating profit reached Rp1.06 trillion, surged 92.3% from Rp550.18 billion in the first half of 2010.

As of June 2011, its assets totaled Rp6.44 trillion while liability amounted Rp1.42 trillion. It has cash and cash equivalent of Rp1.96 trillion.

Clipan Finance to Raise Rp585.74 billion via Rights Issue - The Indonesia Today

Financing firm PT Clipan Finance Indonesia Tbk, controlled by Panin Group, said in prospectus today it plans to issue 1.17 billion new shares through pre-emptive rights scheme in October 2011.

The rights issue is priced at Rp500 per share, then the company will raise proceeds of Rp585.74 billion. It will also issue 911.15 million warrants as sweetener.

Each shareholder who holds 20 old shares will get 9 new shares and 7 warrants. Shareholders recorded at October 5, 2011 are entitled to buy new shares.

The existing shareholders will potentially face a 31.03% dilution of shares if they failed to exercise their rights, or maximum 44.44% dilution after warrants exercise.

Trading of pre-emptive rights is scheduled for October 7-13, 2011.

PT Evergreen Capital will act as standby buyer.

The company said it will use the rights issue proceeds for increasing working capital. It also plans to raise up to Rp500 billion bonds in mid October to boost working capital.

Saham berjangka Jepang naik dipicu data industri AS - Bisnis Indonesia

JAKARTA: Saham berjangka Jepang naik setelah data produksi industri AS menunjukkan kenaikan sehingga membantu menjaga ekonomi negara terbesar di dunia itu dari melemah lebih lanjut dan prospek untuk mengakhiri perang di Libia mendorong bursa Eropa. Saham berjangka Australia sedikit berubah.

American Depositary Receipts (ADR) Honda Motor Co, produsen mobil Jepang yang mendapat 80% lebih pendapatannya dari luar negeri, naik 0,7% dari harga penutupan saham di Tokyo. Canon Inc, pembuat kamera terbesar di dunia, naik 0,4%. ADR BHP Billiton Ltd, perusahaan pertambangan terbesar dunia, turun 0,3% setelah harga logam merosot.

Kontrak pada indeks Nikkei 225 Jepang yang jatuh tempo pada September ditutup pada 8.670 di Chicago kemarin, naik dari 8.620 di Osaka, Jepang. Tawaran di premarket Osaka adalah 8.680, pada pukul 08:05 waktu setempat. Kontrak pada Indeks S&P/ASX 200 Australia sedikit berubah hari ini. Indeks NZX 50 Selandia Baru naik tipis 0,1% di Wellington.

Ryuta Otsuka, strategist Toyo Securities Co di Tokyo mengatakan bahwa saham kemungkinan akan dibeli karena dinilai telah oversold.

Indeks MSCI Asia Pacific turun 14% tahun ini hingga kemarin indeks Stoxx 600 Eropa turun 18%

Saham Eropa rebound dari dua tahun terendah kemarin karena prospek untuk mengakhiri perang di Libia mendorong perusahaan-perusahaan energi. Indeks Stoxx Eropa 600 naik 0,8% menjadi 224,9 pada penutupan 4:30 am waktu London.

Indeks London Metal Exchange yang memuat 6 logam industri termasuk tembaga dan aluminium turun 1,2% kemarin.

Indonesia Stocks: Bumi Resources, Bank Danamon, Semen Gresik - Bloomberg

By Berni Moestafa - Aug 22, 2011 4:23 PM GMT+0700

Shares of the following companies had unusual moves in Indonesian trading. Stock symbols are in parentheses, and prices are as of the 4 p.m. Jakarta-time close.

The Jakarta Composite index (JCI) slipped 3.13 points, or 0.1 percent, to 3,839.62, falling for a second day.

PT Bank Danamon Indonesia (BDMN IJ), owned by Singapore state-owned investment company Temasek Holdings Pte and Deutsche Bank AG, declined 3.9 percent to 5,000 rupiah, extending its 4.6 percent drop on Aug. 19. Danamon said today it plans to sell new shares for 4,300 rupiah each in a rights offer next month. That’s at the lower end of the 4,100- to 4,800-rupiah price target and 17 percent less than Danamon’s last closing price.

PT Bumi Resources (BUMI IJ), Indonesia’s largest coal producer, fell 3.7 percent to 2,600 rupiah, the biggest drag on the Jakarta Mining Index. The shares retreated on concern a plan to pay down debt will be delayed as it remained unclear when the company will go ahead with a $2.1 billion sale of its mining unit, said Adrianus Bias Prasuryo, an analyst at PT Samuel Sekuritas Indonesia.

Bumi Director Dileep Srivastava said the company maintains its schedule to pay down $600 million of its debt this year.

PT Semen Gresik (SMGR IJ), Indonesia’s biggest cement producer, rose 2.8 percent to 9,050 rupiah, the largest increase since April 1. Semen Gresik may invest $150 million to build a cement plant in Papua to strengthen supply for eastern Indonesia, Investor Daily reported, citing Dwi Soetjipto, president director at the company. Soetjipto couldn’t be reached when called at his office in Jakarta.

To contact the reporter on this story: Berni Moestafa in Jakarta

BUMI pertahankan skenario pembayaran utang kepada CIC - Kontan

JAKARTA. PT Bumi Resources Tbk (BUMI) mempertahankan 'skenario terburuk' pembayaran utangnya kepada China Investment Corp (CIC).

Direktur BUMI Dileep Srivastava menegaskan, perseroan tetap menjadwalkan pembayaran US$ 600 juta dari total utangnya yang senilai US$ 1,9 miliar, pada kuartal keempat tahun ini.

Lanjut Dileep, pembayaran tahap kedua sebesar US$ 600 juta lagi akan dilakukan di kuartal keempat 2012. "Dan sisanya dilunasi pada kuartal terakhir 2013," kata Dileep, dalam pernyataan e-mail, hari ini (22/8).

Hari ini, saham BUMI tergerus 3,7%. Koreksi ini disinyalir karena kekhawatiran BUMI bakal menunda rencana pembayaran utangnya. Pasalnya, rencana penjualan unit pertambangannya yang ditaksir senilai US$ 2,1 miliar masih belum jelas hingga saat ini.

Sebelumnya, pada Juli lalu, produsen batubara terbesar di tanah air juga menyebut, rencana pembayaran utang kepada CIC tidak akan bergantung pada penerbitan obligasi konversi oleh perusahaan afiliasi di akhir kuartal ketiga.

Bargain hunters tiptoe back but remain cautious - Reuters

U.S. stocks ended slightly higher on Monday after four weeks of losses as investors hesitated to take big risks without a catalyst for buying.

The market was led by large-cap techs and industrials until late in the session when a rally faded.

Banks struggled. Bank of America (BAC.N), the largest U.S. bank, fell 7.9 percent to $6.42, the biggest drop among the Dow's components. Chief Executive Brian Moynihan sent a memo to senior executives last week outlining plans to cut another 3,500 jobs. JPMorgan Chase (JPM.N) lost 2.7 percent to $33.41.

"The ground zero of all worries is financials," said Charlie Smith, chief investment officer of Pittsburgh-based Fort Pitt Capital Group.

Google (GOOG.O), Hewlett-Packard (HPQ.N) and IBM (IBM.N), were among the top gainers. Hewlett-Packard shares came back from a 20 percent decline on Friday in its worst day since 1987.

The S&P 500 has dropped 12.7 percent so far in August on fears of another recession and the intractable European debt crisis. The rebound came on lower volume than in recent days of selling.

"I don't see any major appetite for buying stocks. We are driven higher (today) because of selling exhaustion," said James Dailey, portfolio manager of TEAM Asset Strategy Fund in Harrisburg, Pennsylvania.

One possible spark for the market could be Federal Reserve Chairman Ben Bernanke's Friday speech in Jackson Hole, Wyoming. Some in the market hope Bernanke will hint at additional stimulus measures that could buoy stocks.

"Until we get some kind of a catalyst from Europe regarding the sovereign debt crisis or from the Fed later this week, I expect range-bound trading with high intraday volatility," said Dailey.

The Dow Jones industrial average .DJI was up 36.85 points, or 0.34 percent, at 10,854.50. The Standard & Poor's 500 Index .SPX was up 0.29 point, or 0.03 percent, at 1,123.82. The Nasdaq Composite Index .IXIC was up 3.54 points, or 0.15 percent, at 2,345.38.

IBM shares gained 0.9 percent at $158.98 and Hewlett-Packard rose 3.6 percent to $24.45.

On Monday, Credit Suisse cut its year-end target for the S&P 500 to 1,100 from its previous level of 1,275. U.S. equity strategist Doug Cliggott cited expectations for lower earnings in coming quarters and little hope for price-to-earnings multiples to expand.

Speculation is widespread in financial markets that Federal Reserve Chairman Ben Bernanke will use his Friday speech at a central banker conference in Jackson Hole, Wyoming, to signal a new monetary offensive to support a faltering U.S. economy.

Bernanke, however, is most likely to outline gradual measures, which would disappoint those looking for something dramatic, such as a fresh round of bond buying, known as QE3.

The Fed chairman looks set to discuss ways the Fed could tweak its balance sheet as a means to put further pressure on medium and long-term interest rates and anchor them at low levels. These could be implemented in September and October at coming Fed meetings.

After the closing bell, shares of Goldman Sachs (GS.N) fell 2.4 percent to $104. Goldman Chief Executive Lloyd Blankfein has hired Reid Weingarten, a high-profile Washington defense attorney, according to a government source familiar with the matter.

Blankfein, 56, is in his sixth year at the helm of the largest U.S. investment bank. Investigations of Goldman and its role in the 2007-2009 financial crisis continue.

About 8.46 billion shares were traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, in line with last year's daily average of 8.47 billion.

On the NYSE, decliners beat advancers by a ratio of four to three, while on the Nasdaq, about seven stocks fell for every six that rose.

Markets Could Be Making a Losing Bet on More Fed Easing - CNBC

Published: Monday, 22 Aug 2011 | 2:15 PM ET
By: Jeff Cox Staff Writer

Investors betting that Federal Reserve Chairman Ben Bernanke is about to come to the rescue with another round of monetary easing could be setting themselves up for a major disappointment.

Bernanke's much-awaited speech during the central bank's gathering at Jackson Hole, Wyo., later this week is setting up as a potential lose-lose situation: The chairman may not provide the market's desired signal for a third round of quantitative easing [cnbc explains] —or QE3—and even if he does it may not help.

That's the sentiment of a number of economists and strategists, despite a Monday market rally that appeared to be fueled by speculation that Bernanke will ride to the market's rescue at the same time and under similar circumstances in 2010.

"The market's sending a signal to Bernanke saying, 'We want QE3 and we want it this week, or we're going to hammer you and the market will get absolutely killed,' " said Keith Springer, president of Springer Financial Advisory in Sacramento, Calif. "The stock market is addicted to QE."

Then, as now, Bernanke faced pressure to act after the market slid 17 percent in the summer of 2010 amid fears of European sovereign debt [cnbc explains] contagion and a double-dip recession [cnbc explains] in the U.S. The market has dropped nearly the same amount since coming off its early May 2011 highs and as one economist after another cuts projections for growth this year, to levels near 1 percent.

In 2010, Bernanke used his Jackson Hole speech—normally a low-key affair that vaguely charts the central bank's direction well into the future—to indicate that additional asset purchases were on the way to stimulate growth.

In November, the Fed [cnbc explains] announced $600 billion in Treasurys purchases that sent stocks on a sharp upward trajectory for eight months and kept interest rates at a relatively low level.

But since the summer slump, the S&P 500 [.SPX 1123.82 0.29 (+0.03%) ], while up about 6.5 percent since the Jackson Hole speech, is actually about 4 percent lower than when the second round of easing officially began.

The slowdown will add more drama to the direction Bernanke signals at Jackson Hole.

"We believe Bernanke’s Jackson Hole speech will include a detailed discussion of the potential for more easing through large-scale asset purchases," Goldman Sachs economist Zach Pandl wrote in a note. "A variety of indicators suggest many investors already expect more QE."

Pandl pointed specifically to a CNBC survey indicating that asset purchases already may have been priced into the market, meaning that more would be required to juice the market further.

Instead, Pandl expects the discussion to focus more on what is referred to sometimes as Operation Twist—a 1960s-era term that refers to the central bank's effort to compress the yield curve [cnbc explains] .

Rather than expand the already-bloated Fed balance sheet, the move would sell short-term debt and buy-long term debt, as a way to drive down long-term rates further and spur investment.

"Based on our conversations with clients, we believe investors would be very surprised if the speech did not include a discussion of asset purchases," Pandl wrote. "We see two main reasons why Fed officials may prefer to change the composition of the balance sheet as a first step...If used aggressively, this could have a sizable impact."

Whether that will be enough to assuage the market's thirst for even more of the unprecedented intervention that has taken place since the financial crisis is an open question.

Wall Street, though, seemed to be sending a signal Monday.

"Market up today only because (it) expects that Ben will come by helicopter to Jackson Hole to dispense QE3," Nouriel Roubini, head of Roubini Global Economics, tweeted on his Twitter account early Monday. "If he doesn't, (expect to) see market sharply down."

But investors banking on the kind of impact the Jackson Hole speech had last year may be let down.

"It definitely could be setting up for disappointment," said Dave Lutz, managing director of trading at Stifel Nicolaus in Baltimore. "People might be covering some shorts [cnbc explains] going into it. But I don't see traditional managers taking big bets going into Friday, given that it's such a high volatility event."

The market, then, could use the Bernanke speech not as an event to smooth the peaks and valleys that have dominated trading over the past seven weeks, but rather to exacerbate them.

"The big thing is if he does announce it we're going to have a thousand-point rally. We'll be making new highs before you can blink," Springer said. "I am hedged right now, but you've got to have your finger on the button."

Merkel Says She’ll Resist Pressure for Euro Bond - Bloomberg

German Chancellor Angela Merkel attempted to shut the door on common euro-area bonds as a means to solve the debt crisis, saying that she won’t let financial markets dictate policy.

Joint euro bonds would require European Union treaty changes that would “take years” and might run afoul of Germany’s constitution, Merkel said. While common borrowing might arrive at some point in the “distant future,” bringing in euro bonds at this time would further undermine economic stability and so they “are not the answer right now.”

“At this time -- we’re in a dramatic crisis -- euro bonds are precisely the wrong answer,” Merkel said in an interview with ZDF television in Berlin yesterday. “They lead us into a debt union, not a stability union. Each country has to take its own steps to reduce its debt.”

Merkel has stepped up her opposition to euro bonds since returning from her summer vacation last week, making resistance to common European borrowing a campaign theme of Sept. 4 elections in her home state of Mecklenburg-Western Pomerania. Investor calls for euro bonds intensified last week as concerns about the debt crisis and a stuttering global economy drove European stocks to their lowest in more than two years.

‘We’re Unassailable’
“Politicians can’t and won’t simply run after the markets,” Merkel said in the chancellery interview, her first since returning from a three-week summer break. “The markets want to force us to do certain things. That we won’t do. Politicians have to make sure that we’re unassailable, that we can make policy for the people.”
European stocks rose today, rebounding from a two-year low, with the Stoxx Europe 600 Index gaining as much as 1.1 percent. German 10-year bunds fell, sending yields up 2 basis points to 2.12 percent at 10:35 a.m. in Berlin.

Pledges of 365 billion euros ($526 billion) in official loans to Greece, Portugal and Ireland, and 96 billion euros of bond purchases by the European Central Bank have yet to fix the finances of those countries or prevent speculative attacks on Spain and Italy.

National benchmark indexes fell in every western European market except Iceland last week, with Germany’s DAX Index (DAX) declining 8.6 percent. Compounding investor concerns, statistics released Aug. 16 showed the German economy, Europe’s largest, almost stalled in the second quarter.

Debt Reduction
“I see nothing that points to a recession in Germany,” Merkel said. “But I see considerable long-term tasks ahead of us that have to do with markets regaining confidence in Europe and that have a lot to do with reducing debt.”
Merkel’s stance risks bringing her into conflict with the European Commission, the European Union’s executive body, which said Aug. 19 that it may present draft legislation on joint euro-area bonds after completing a feasibility report.

She is also at odds with Germany’s main opposition Social Democrats and their Green Party allies, both of which support euro bonds even as polls suggest a majority of the German public is against them. Germany would face extra costs of 47 billion euros a year if it aligned interest rates with nations that pay more to borrow, the Munich-based Ifo institute said on Aug. 17. Merkel’s two coalition partners, the Free Democratic Party and Christian Social Union, spoke out against euro bonds in weekend newspaper interviews.

‘Inflation Community’

German Finance Minister Wolfgang Schaeuble entered the fray two days ago in his first public engagement since the summer break, saying that the euro region would become an “inflation community” if member countries decided to sell bonds jointly without unifying their fiscal policies.
“Unless there is a single financial policy in the euro area, there won’t be a single rate of interest” on debt sold, Schaeuble said at an open doors event at the Finance Ministry.

Schaeuble said that he’s prepared to cede sovereignty to the EU to achieve political union, even if most other EU members are not currently ready to do likewise, the Welt am Sonntag newspaper cited him as saying in an interview published yesterday. Schaeuble said he has no problem with the idea of a European finance minister, according to the newspaper.
EU President Herman Van Rompuy sided with Germany and France, ruling out issuing common bonds as a cure for the debt crisis at least until European economies and budgets are better aligned.

With three countries drawing financial aid and national debts ranging from 6.6 percent of gross domestic product in Estonia to 142.8 percent in Greece, this is the wrong time to set up a single borrowing agency, Van Rompuy said in an Aug. 20 interview on Belgium’s RTBF radio.

Voting Seen
The German government aims to put changes to the European rescue fund and a second round of financial aid for Greece to a parliamentary vote on Sept. 23. That’s five days after a state election in Berlin, the last of seven regional votes this year which have seen Merkel’s Christian Democrats punished as voters railed against public bailouts of indebted euro-area countries.

Merkel, who said that she’s confident of a majority to pass the changes in parliament, called for the focus of Europe’s crisis-fighting strategy to remain on tackling debt. Decades of deficit spending in euro-area countries has turned the region into a “debt union” that requires each country to slash debt levels, she said.

“This is an arduous, difficult path that can’t be solved in one fell swoop, for instance with euro bonds,” she said.

Senin, 22 Agustus 2011

Indeks Kospi menguat 0,99% ke 1.762,18 - Bisnis Indonesia

HONG KONG (Bloomberg): Indeks saham Kospi acuan Korea Selatan menguat 0,99% pada pukul 9:05 a.m.

Indeks yang disokong oleh saham 780 perusahaan yang diperdagangkan di Korea Exchange itu naik 17,30 poin ke level 1.762,18.

Di antara sejumlah saham yang tergabung dalam indeks, 430 di antaranya menguat, 155 turun dan 195 tetap.

Penguatan pada indeks Kospi itu dipimpin oleh Hyundai Motor Co, Samsung Electronics Co dan LG Chem Ltd. Sekitar 27,01 juta saham berpindah tangan.

Hynix Semiconductor Inc, yang naik 450 won ke posisi 16.050 won, merupakan saham teraktif dari segi nilai di Korea Selatan.

Saham paling aktif berikutnya adalah Kia Motors Corp, yang naik 500 won di level 63.000 won, dan Hyundai Motor Co, yang menguat 3.000 won ke 173.500 won.

Summarecon mulls rights issue to acquire land - Bisnis Indonesia

JAKARTA: PT Summarecon Agung Tbk, which is building a satellite town outside Jakarta, is studying options to issue bonds and rights shares worth a combined IDR600 billion approximately to finance land acquisitions.

The company needs IDR500-IDR600 billion to acquire 200 hectares of land in Serpong, Bekasi and Bandung, Finance Director Michael Yong told Bisnis.

“Real estate companies are prohibited from using loans from banks to acquire land. That is why we are studying the options.”

The real estate developer has not decided on the timing of the rights issue and bond sale, Michael said. The acquisition is a way to enlarge company’s land bank from 460 hectares currently. One hectare is 10,000 square meters.

During the first half, the company acquired 100 hectares of land in Serpong, Bekasi and Bandung amounted to IDR470 billion. “The fund was taken from internal cash.”

From the acquired 100 hectare land, 70 hectare land is in East Bandung which will be developed into be a satellite town.

The company is targeting to acquire up to 200 hectare lands in Bandung with an estimated IDR200 billion investment. The development is expected to start in 2015. (18)

XL Axiata Raises Capex to $850 Million - The Indonesia Today

PT XL Axiata Tbk (EXCL) raises its capital expenditure (capex) to US$850 million for this year, from the original capex of Rp550 million, Investor Daily reported this morning.

Nicanor V Santiago, EXCL's chief Commerce Officer, said 40% of the additional capex will be allocated to fund the expansion of data service business in the second half of 2011.

He said data service segment had contributed 21% to the company's total revenue, compared to below 15% contribution in 2010. XL Axiata booked revenue of Rp9.14 trillion in the first half of 2011, with data service contributing revenue of Rp1.54 trillion.

Nicanor said the customers of XL's data service reach around 200 customers while customers of mobile internet from cellular phone total 20 million.

Total number of XL's subscribers increased by 10% to 38.9 million in the first half of 2011, from 35.2 million in the same period of 2010.

Bank Saudara H1 Profit Jumps 71% - The Indonesia Today

PT Bank Himpunan Saudara 1906 Tbk (SDRA) posted profit after tax of Rp50.56 billion in the first half (H1) of 2011, jumped 71% from Rp29.59 billion in the same period of last year.

Net interest income rose 33% to Rp153.69 billion while interest income totaled Rp267.33 billion.

Operating pofit surged 62% to Rp68.59 billion from Rp40.12 billion in the first half of 2010.

As of June 2011, its assets totaled Rp4.06 trillion, of which credits amounted Rp3.16 trillion. The bank recorded third party funds of Rp3.3 trillion, of which term deposits accounted for Rp2.73 trillion.

Kertas Basuki to Issue New Shares for Debt Conversion - The Indonesia Today

Paper producer and distributor PT Kertas Basuki Rachmat Indonesia Tbk said in a propectus published today that it plans to issue 774.87 million new shares to PT Wahyu Berkat Abadi (WBA) for converting debt.

The company's outstanding debt to WBA amounts Rp51.92 billion which is demanded to settle by September 30, 2011 for the latest.

The new share will be exercised at price of Rp67 per share. The new shares issuance represents 9.79% of the company's enlarged capital.

The company schedules to hold extraordinary general meeting (EGM) of shareholders in September 21, 2011 for gaining approval on the debt to equity proposal.

After the issuance of new shares, the company's shareholders composition would be Riverton Group Holdings Limited (17.27%), Investments Limited (10.2%), Wyoming International Limited (11.4%), AAA-JS Multisectoral Fund (17.93%), PT Wahyu Berkat Abadi (8.92%) and public investors (34.30%).

UPDATE 1-Indonesia's Bumi Resources Q2 net up 20 pct - Reuters

(Updates with Q2 profit, coal forecast)

Aug 19 (Reuters) - Bumi Resources , Asia's biggest thermal coal exporter, saw second quarter 2011 net profit rise 20 percent, helped by higher prices and driven by strong demand from China and India.

Bumi has increased its forecast for 2011 average coal prices to $90 per tonne, higher than its previous forecast of $77 per tonne, due to expanding utility capacity in India and China. Production is seen at 66 million tonnes this year.

Bumi's second-quarter net profit was $155 million, versus $129 million in the year ago period, according to Reuters calculations based on published second-half figures.

First-half net profit was $278.6 million, compared with a restated $271 million in the same period a year earlier. Bumi had said last year its first-half 2010 net profit was $134.6 million. First-half revenue rose 24 percent to $1.8 billion.

Bumi, which the politically connected Bakrie family and Nathaniel Rothschild control via London-listed Bumi Plc , plans to repay the first $600 million tranche of a $1.9 billion loan to the China Investment Corporation (CIC) in October.

Investors has discounted Bumi's shares against a booming Indonesian stock market due to high debt levels and concerns on corporate governance.

Bumi Plc said on Wednesday that thermal coal prices should remain strong over the short and medium-term on higher demand from both Asia and Europe.

Analysts forecast Bumi's 2011 net profit to rise 56 percent to $484.3 million, according to Thomson Reuters Starmine's SmartEstimate.

Shares in Bumi were down 2.7 percent by 0405 GMT after the results, after falling more than 2 percent in the first half of the year to underperform a Jakarta index up around 5 percent in the same period. (Reporting by Janeman Latul; Editing by Neil Chatterjee and Mat Driskill)

Bumi Resources: “clean” 2Q11 net income of US$118.8mn, full year consensus of US$477mn looking too conservative (BUMI, Rp2,750, Buy, TP: Rp3,700) - Mandiri

􀂄 The 2Q11 net income rose by 50% QoQ, driven by 11% higher sales, 33% higher gross profit, and 51% higher EBIT. These results should alleviate yesterday’s concerns that the strong showing by Bumi Plc (who reported 1H11 results two days ago) was only driven by non operating items.
􀂄 If we take-out the US$106.8mn derivatives gain and the US$17.2mn loss on asset write-down and adjust those for the tax effects, the “clean” 2Q11 net income for Bumi would be around US$118.8mn.
􀂄 If Bumi can sustain its “clean” profit level of US$118.8mn in the third and fourth quarter, the company should be able to achieve US$517mn profit for the year, against consensus of US$477mn. We think Bumi should be able to show higher quarterly run-rate for its “clean” profit, due to higher output volumes in 2H11 (heavy rains and floods have forced Bumi to do more over-burden removals in 1H11).
􀂄 We foresee consensus EPS on Bumi Resources to move up as the year progresses. We are currently forecasting FY11F net profit of US$500mn, placing the stock on 13.4-11.4x PER for FY11-12F. Buy with TP of Rp3,700.

Bumi Resources - 2Q preliminary operating data; strong ASP - Deutsche Bank

This is based on Bumi Plc's 1H11 results published on August 17, 2011.
BUMI full result is expected to be reported at the end of August 2011.

2Q11 coal mined up by 13.6%QoQ; largely on-track
Volume of coal mined in 1H11 reached 29.9 mT (-2.3% YoY, 45% of DB FY of 66mT), of which 14 mT was mined in Q1 and 15.9 mT (+13.6% QoQ) was in Q2. In order to reach DB FY11, company needs to reach quarterly vol mined in 2H of 18 mT (13% higher than 2Q than realization), appears achiavable given improved weather conditions.

Strong ASP, balancing higher cost
2Q11 ASP reached record high of $94.6/t (+7.87% QoQ). 1H11 ASP reached US$91/t (+36%YoY), already exceeded DB FY11 of $90.5/t. ASP in 2H11 need to only average at $89.8/t in order to meet the FY forecast. Production cost of sales up +23% YoY to $44.7/t in 1H11, higher compared to 1Q11's 6.3% YoY increase, as implied stripping ratio for 2Q11 rose to 12.1x from 11.9x in 1Q11.

Overall, these preliminary operating data appears largely in-line with expectations, though we remain cautious on its non-operating items, given potential auditing ahead of future consolidation into Bumi PLC. The stock also currently trades at 8.3x 2012F PE, a premium to the sector average of 7.3x. Maintain Hold.

SMRA in CLSA property access day Singapore CLSA

Summarecon Agung (SMRA IJ) attended our property access day in Singapore. Please see latest update from Daniel Oen (attending the access day) and property analyst Sarina. Land price appreciation remains robust. Its shop-house demand remains very strong, with price doubling YoY.

SMRA is one of the best property developers in the country. Well run company with strongest brand and good track record of execution. See attached for details.

Key Points from the report:

· Marketing sales have been robust lately, with 8M11 sales expected at ~Rp2tn, which is 87% of FY11 target of Rp2.3tn.
· As such, SMRA will raise its sales target to Rp2.6tn (20% YoY from 10% YoY before).
· SMRA also mentioned that if they decide to do four more launches (two in Serpong, and two in Bekasi), then sales may be able to achieve Rp2.8tn (29.6% YoY)
· Land price appreciation very robust. First cluster launched last year was done at Rp1.9m psm in Bekasi. The next launch will see land price raised to Rp3m psm.
· Shop-house demand remains super strong. Land price for shop-house has effectively doubled YoY to Rp11m psm. SMRA is confident company can charge same price in Bekasi!
· Almost ready to launch Serpong Mall part 2 (another 50k sqm) next month. 80% of the space has already been leased out.
· SMRA currently trades at 16% discount to its NAV. Always a bit pricey vs. peers, but delivering superior returns to investors (ROE 15% FY11).

Agung Podomoro: APLN sets Rp1.2tn bonds with 10% and 11% coupon (APLN, Rp340, Buy, TP: Rp430) - Mandiri

􀂄 APLN announced today final structure of its bonds issuance plan. The total issuance is Rp1.2tn, which comprised into two series: (1) Rp325bn 3-year series at 10%; and (2) 875bn 5-year series at 11%. Tentative timeline:
- Effective date: Aug 18, 2011
- Offering date: Aug 22-23, 2011
- Allotment date: Aug 24, 2011
- Electronic distribution date: Aug 25, 2011
- Listing date: Aug 26, 2011
􀂄 We see the bonds positively as consistent to its commitment in taking active expansion thus sustain the company’s growth going forward. Minimal downside is seen from the issuance, where earnings slipped by only 2%, based on our 12F. APLN currently trades at attractively PE12F of 10.6x, vs. CTRP of 18.7x. Maintain BUY, with TP: Rp430/share.

Bakrie Sumatera Plantations: 1H11 profit surprise next week (UNSP, Rp405, Neutral, TP: Rp400) - Mandiri

􀂄 We met with UNSP’s new IR head Mr. Hadi Susilo, who joined the company about two to three weeks ago. Prior to joining UNSP, Mr. Hadi Susilo was IR head at Sorini Agro Asia Corporindo (SOBI IJ).
􀂄 We are hopeful that Mr. Hadi Susilo can bring significant improvements to UNSP’s investor relations effort and disclosure ahead. Since the beginning of 2010, the flow of information (especially the operating data) has been somewhat inconsistent.
􀂄 We notice that some brokerage houses have dropped coverage on UNSP over the past months, possibly owing to the inconsistent data flow. Of the eight remaining analysts covering UNSP, only five made some changes to their target price or rating. Coverage from the other three analysts seem stale, with last update done in year 2010.
􀂄 We are pleasantly surprised to learn that UNSP already bagged Rp405bn net profit in the five months to May 2011, against a full year consensus of Rp579bn (FY11F P/E consensus of 9.1x versus peers of 12.2x). In the 1Q11, UNSP reported Rp132.5bn net profit. Its 1H11 results are being reviewed by auditors currently, likely to be out by next week.
􀂄 Granted that much of the profit surprise could be coming from one-off gains, namely FX and perhaps debt restructuring gains. On 12 July, UNSP disclosed to the IDX about the completion of its debt restructuring, for the US$210mn Domba Mas facility where Credit Suisses was the arranger. That said, the one-off profit surprise may serve as a worthwhile catalyst for UNSP, that trades on mere 0.7x PBV and one of the lowest EV-to-planted CPO plantations. We would flag the trading opportunities in the counter ahead of 1H11 results release.

Automotive: July11 official domestic car and motorcycle wholesale reach all-time high - Mandiri

􀂄 Domestic car wholesale reached all-time high in July11 at 89,056 units (+23.5%yoy, +26.9%mom). Astra International also booked all-time high car sales volume in July11 at 47,500 units (+14.4%yoy, +19.2%mom). Astra market share in car wholesale normalize at 53.3% in July11 from 56.8% in June11, mainly due to Honda’s car wholesale has recovered in July11 after drop in June11. We expect car wholesale keep strong in August11 due to car wholesale usually high before Muslim festive and the availability of low leasing rate.

􀂄 Domestic motorcycle reached all-time high in July11 at 737,809 units (+5.5%yoy, +12.0%mom). Meanwhile, Astra’s motorcycle wholesale in July11 only increased slightly by 0.4% mom. Therefore, Astra market share in Motorcycle wholesale dropped to 49.2% in July11 from 54.9% in June11. We expect motorcycle wholesale keep strong in August11 due to motorcycle wholesale usually high before Muslim festive and the availability of low leasing rate.

Why the U.S. Is Not Japan - Market Beat WJS

By Stephen Grocer

With concern that the U.S. economy is close to tipping back into recession, many investors are wondering if the U.S. is turning into the Japan of the 1990.

Certainly, there are similarities. Both economies faced massive asset price and credit bubbles, which left the private sector with a huge amount of debt when it burst. The deleveraging that followed in both countries also stymied growth and the effectiveness of their respective central banks to respond. And both the U.S. and Japan have witnessed an increase in government debt.

Despite these similarities, economist Paul Sheard over at Nomura, the Japanese brokerage firm, says that the U.S. is not Japan. The key differences:

“What marks Japan out since the bursting of its asset price bubble in 1990 is not that it faced deleveraging headwinds and balance-sheet adjustment challenges, and experienced a prolonged period of slow growth, per se. Rather it is that, as a result of a series of policy errors, the economy slipped into deflation and has stayed there, more or less, ever since. Japan made three key policy errors: it was extremely slow to recognise and then deal with asset impairment problems in the banking system, which “doubled down” on the stymieing of monetary policy; the central bank never adopted the “do whatever it takes” kind of monetary policy stance necessary to quash deflation (e.g., by engaging in sufficiently aggressive quantitative easing); and fiscal policy was put on a path of consolidation too early.”

Sheard goes on to conclude:

“The fact that the US has not experienced deflation and that its nominal GDP has resumed an upward trend is no guarantee that it will not do so in the future. Given that it is still relatively early post-crisis days, it is conceivable that the US could yet “turn into Japan” in that deflationary sense. But the fix-it (rather than forbearance) approach employed in the banking system and the Fed’s aggressive balance sheet expansion make such an outcome appear quite unlikely. Politics may make it more likely that the US follows Japan in putting the fiscal brakes on the economy too early, but that alone is unlikely to put the US on a Japan-style deflationary path.”

Short Term Trends in Gold, Silver, Commodities, Oil, the Dollar and the S&P 500 - Seeking Alpha

Adam Hewison, charting strategist of INO.TV, brings you another edition of his invaluable service of daily technical updates on the ups and downs of various markets. This short analysis is a great tool for keeping one’s finger on the pulse and timing the markets.

Click the image below to hear Adam’s latest views on gold , silver, the US Dollar Index, the CRB Index, crude oil and the S&P 500 Index.

Here is a summary of his technical outlook:

S&P 500: -100. Remember, the major trend is down for the equity markets and strong rallies represent shorting opportunities. Looking at the weekly charts, a close below 1,178.81 would be extremely negative. [PduP: The Index closed below this level on Friday - at 1,123.53.] The lowest close we have seen on the S&P 500 this year is 1,119.46. This is another level to watch carefully. We see this market going lower.

Silver: +100. Our Trade Triangles kicked in and flashed a buy signal at $42.20 yesterday basis spot. Based on this signal, all traders should be either long this market or looking to trade silver from the long side. We made this call on Twitter on 8/16 telling everyone to set their orders to long.

Gold: +100. Long term, intermediate and short term traders should hang on for the ride and protect profits with stops. It looks more and more likely that we will get close to the magical $2,000 an ounce. We expect to see professional profit taking and some shorting at that level.

Crude Oil: -100. Long term, intermediate and short term traders should hang on for the ride and protect profits with money management stops. The longer term trend for crude oil is down based on our Trade Triangle technology.

U.S. Dollar Index: -60. This market has remained in a fairly well defined trading range for the last several months. With a Chart Analysis Score of -60 we would want to approach this market using our Donchian Trading Channels as well as our Williams %R indicator. The Index remains below its 200-day moving average while our longer term Trade Triangle remains positive.

CRB Commodity Index: -100. While our bias is towards inflation, the index is currently indicating that we are in more of a deflationary scenario. We want to remain patient and let our Trade Triangles signal when this market has made a trend change to the upside. Long term, intermediate and short term traders should hang on for the ride and protect profits with stops.

Is there a gold bubble now? - The Economic Times

22 Aug, 2011, 01.08AM IST, Narendra Nathan,ET Bureau
After reporting consistent gains for the past 10 years, gold continues to be the best performing asset this year as well. The year-to-date return is a whopping 35% as the price of gold touched an all-time high of Rs 27,840 per 10 gm on 19 August. While new investors and speculators are rushing to benefit from this 'golden harvest', seasoned players have already started raising an alarm.

"Gold is getting into a bubble territory. Though the short-term uptrend may continue due to the ongoing sovereign crisis in the US and Europe, it can burst any time," warns Prithviraj Kothari, president, Bombay Bullion Association. So investors need to be cautious. While it is the 'safe haven' demand that is propping up gold, investors need to keep in mind that this is not a risk-free market. Gold had crashed to $260 an ounce (nearly 69%) after hitting a peak of $850 in 1980.

How long will the current rally continue? "Gold may remain strong for the next 6-9 months, but once things stabilise and other markets start doing well, money will move out of gold. After three years, gold prices may be lower than the current level," says Kishore Narne, head, commodity, Anand Rathi Financial Services

What is triggering the gold rally?

Here's a look at some crises that are driving the gold market now.

US crisis:
One of the causes has been the downgrading of the US sovereign debt to AA+ from AAA, a rating it had held for the past 70 years. The efforts by the US government to support the faltering economy is another reason. For instance, rising interest rates usually lead investors away from gold. However, the decision by the US Federal Reserve to leave interest rates close to zero for two more years will boost the gold market.

Euro crisis:
Several European countries, such as Portugal, Ireland, Greece, Spain and Italy, may be forced to default in the short to medium term. Their efforts to reduce spending and increase taxes are being hampered by a faltering Eurozone economy, which grew by just 0.2% in the second quarter, its worst performance after emerging from the recession in 2009. There are also concerns about the ability and willingness of relatively stronger countries, such as Germany and France, to support the troubled ones.

Currency crisis:
As two major economic blocks (US & Europe) suffer problems, central bankers of several countries have started losing faith in their reserve currencies and have decided to buy gold as an alternative. For instance, in July, Thailand, South Korea and Kazakhstan added gold valued at $2.56 billion to their reserves.

Falling consumption demand
While the investment demand is shooting up (holdings in exchange-traded products backed by gold rose to a new record of 2,217 tonnes on 8 August), the consumption (jewellery) demand is on the wane. According to the recently released World Gold Council report, the global gold demand in the second quarter of 2011 came down by 17% y-o-y to 919.8 tonnes.