tapi katanya tahun depan bisa capai record high http://www.bloomberg.com/apps/news?pid=20601080&sid=a3m1PsDILD8U
By Berni Moestafa Oct. 23 (Bloomberg) -- Indonesian stocks may enter a "correction" on selling by investors to secure gains from Asia's third-best rally this year because of concern Cabinet appointees lack economic experience, a Citigroup Inc. unit said. President Susilo Bambang Yudhoyono named two allies to key economics and energy ministry posts this week. The appointments may be seen as political pandering, compromising the government's ability to drive growth, said Sunny Yoon, president director of PT Citigroup Securities Indonesia. The Jakarta Composite index has risen 80 percent this year. Yudhoyono's re-election in July raised optimism he will maintain policies that have helped the economy expand at the fastest pace since the 1997 Asian financial crisis. He won the polls with 60.8 percent of the 121.5 million valid votes. "There appears to be a disconnection, why would you produce a compromised Cabinet when you have a clear mandate?" Yoon said in a telephone interview in Jakarta yesterday. "The risk here for the market is that a lot of expectation has been built in for a more professional, technocratic type of Cabinet and it hasn't happened." Global interest rates are set to rebound as inflation accelerates, adding a trigger for investors to "realize gains" in Indonesian stocks, Yoon said. Banking and cement shares are most likely to fall, he said. The benchmark index may "consolidate" at around 2,300 to 2,400 by the end of the year, he said. The measure yesterday slid 1.8 percent to 2,433.18, set for a 3.3 percent drop this week, the worst in four months. Rajasa, Saleh State Secretary Hatta Rajasa, a member of the National Mandate Party allied to Yudhoyono, was named coordinating minister for economic affairs. Rajasa has "limited economic experience but it's hoped he'll be able to provide a political shield for economic ministers under him in the parliament," said Fauzi Ichsan, chief economist at Standard Chartered Bank Plc in Jakarta. Darwin Saleh, an economics lecturer and member of Yudhoyono's Democrat Party, will become energy minister running Southeast Asia's biggest oil and natural gas industry. He has "insufficient experience in that field," said Umar Juoro, an economist at the Jakarta-based Center for Information and Development Studies. "Partisan politics apparently still played a significant role in the assignment" of some key ministerial posts, Helmi Arman, an economist at PT Bank Danamon Indonesia Tbk in Jakarta, said in an e-mailed response to questions. The president must make sure "Cabinet ministers don't go their separate ways" and that they stick to the government's agenda, he said. Reassure Investors Other appointments by Yudhoyono are more likely to reassure investors. He retained Finance Minister Sri Mulyani Indrawati and Trade Minister Mari Pangestu. Sri Mulyani and Pangestu, along with Vice President Boediono, the former head of the central bank, are "most favored by the markets," said Winang Budoyo, an economist at PT Bank CIMB Niaga. The Democrat Party, which held 10 percent of parliament during Yudhoyono's first term, almost tripled its share to 148 seats in April 9 legislative elections, making it the biggest party in the 560-strong body. Yudhoyono's coalition controls 75 percent of parliament. "Those that had predicted a more assertive presidency in the second term could start toning down their expectations," Bank Danamon's Arman and Anton Gunawan wrote in a note yesterday. "We think the announcement of the Cabinet line-up would at most have a neutral impact for the markets." 2010 Advance Next year, the Jakarta Composite may advance and exceed its January 2008 record of 2,830.26 points, Citigroup's Yoon said. He recommends PT Telekomunikasi Indonesia, the nation's biggest company by market value, as it's trading at a discount to the market and will benefit from improving consumer demand in 2010. Consumer spending accounts for about two-thirds of the economy. The government expects growth to accelerate to 5.5 percent next year from an estimated 4.3 percent this year. Bank Indonesia has cut its benchmark interest rate nine times to a record low of 6.5 percent this year, helping Southeast Asia's biggest economy avoid the global recession. Speculation that the central bank will increase interest rates has intensified with gains in inflation. Consumer prices rose 2.83 percent in September from a year earlier after gaining 2.75 percent in August. That was more than the 2.6 percent increase expected by economists in a Bloomberg News survey. Bank Indonesia, which kept rates unchanged for a second month on Oct. 5, is scheduled to hold its next policy meeting on Nov. 4. To contact the reporter on this story: Berni Moestafa in Jakarta at bmoest...@bloomberg.net Last Updated: October 22, 2009 22:12 EDT
