Jakarta stocks climb to eight-week high

Jakarta stocks broke through resistance at 780-points on Monday to end at an eight-week high, driven by positive political developments and gains in cigarette firms and banks in anticipation of strong first quarter results.
News at the weekend that Indonesian presidential favourite Susilo Bambang Yudhoyono had picked Jusuf Kalla, a cabinet member and Golkar party official, as his vice-presidential running mate was seen positive by the market, dealers said.
"The presidential candidates are getting clearer. The market reacted positively to the duet of Yudhoyono, who has a military background to guard security conditions, and Kalla, who is a businessman," said Yudhistia Susanto, a fund manager at Batavia Prosperindo Aset Manajemen.
"The duet is expected to be able to boost investment in Indonesia," he added.
Indonesia will hold its first ever direct presidential election on July 5. Votes from the parliamentary ballot on April 5 are still being tallied, but with more than 60 percent of the electorate counted the country's two biggest secular parties, including Golkar, the former political vehicle of strongman Suharto, have garnered the most the votes.
The composite index finished up 8.27 points, or 1.06 percent, at 784.84 points on Monday in healthy turnover of 873.7 billion rupiah ($101.6 million).
Gainers led losers 61 to 59 while 73 shares were unchanged.
Analysts said Indonesian stocks could gain further, although strong resistance is expected at around 794 points. Some warned the market was overbought.
"The market is overbought and we suggest taking profit," said Yuganur Wijanarko, a chartist at Danareksa Securities.
Blue chip gainers included the country's largest cigarette maker, PT Gudang Garam Tbk, which jumped 6.32 percent to end at 14,300 rupiah. Rival PT Hanjaya Mandala Sampoerna Tbk, the third largest, rose 4.3 percent to 4,850 rupiah.
A local dealer said strong first quarter sales reported by medium-sized cigarette company PT Bentoel International Investama Tbk prompted investors to snap up shares in the larger players.
Some banking stocks also rose in anticipation of strong first quarter results, including the country's fourth-largest bank, PT Bank Rakyat Indonesia Tbk, which gained 5.48 percent to end at 1,925 rupiah.