• Key market drivers: Indonesian equities went sideways in May, with the JCI up a mere 0.45% to close at 3,837. The Rupiah was also little changed at 8,543, from April’s record 7 year high close of 8,563. Dollar returns on the JCI were 0.67%, mirroring the slight upticks in the JCI Index and USD/IDR rate. Daily trading slipped 3.6% from April’s volumes to average $566m in May. MSCI Indonesia despite going sideways in USD terms outperformed the EM & Asia-Ex Japan benchmarks by 3.2% and 1.9% respectively, widening its YTD lead. Agri stocks and consumer discretionary majors did well during the month while Financials lost ground.
• Key economic events: The President signed a decree to implement a moratorium on primary forest conversion. The Government announced new infrastructure projects worth Rp 190trn as part of a programme to accelerate long term growth. The Government said that it aimed to cut unemployment by 50 bps to 7% Next year and to 5% over the long term. Pertamina said that sales of unsubsidised fuels were down 38% y/y in 1QFY11. Inflation for the month of May slipped back into the Central
Banks comfort range, printing at 5.98% y/y. Consumer prices rose 0.12% m/m, while core inflation was stable at 4.64%. The trade balance narrowed in the month of April to $1.63bn.
• Key company news: 1) PT Telkom said that it was mulling buying out SingTel’s stake in Telkomsel 2)The Financial sector saw a flurry of bond issuance across banks and multifinance companies 3) BRI launched a tender offer for the 12.2% of Bank Agro Niaga that it does not yet own 4) The Astra group detailed capacity expansions to its Daihatsu and Toyota Factories 5) United Tractors said that it was bidding with consortium partners for the right to build 2 power plants in Sumatra 6)
PGAS said that it had.
Minggu, 05 Juni 2011
Indonesia Monthly Wrap - May 2011: Holding on to higher ground - JP Morgan
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