Reuters: Hot Stocks: STOCKS NEWS INDONESIA-CIMB keeps 'overweight' rating on retail sector

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STOCKS NEWS INDONESIA-CIMB keeps 'overweight' rating on retail sector Aug 14th 2012, 07:08 Tue Aug 14, 2012 3:08am EDT CIMB Research retained its 'overweight' rating on the Indonesian retail sector saying share prices did well despite July's softened consumer confidence. "Consumer confidence softened slightly in July, which is not unusual during this time of the year when prices are rising. Retail sales remain strong, suggesting a buoyant sales outlook for the Eid holiday," CIMB analysts Erwan Teguh and Cindy Effendi said in a note to clients on Tuesday. "Our discussions with retailers suggest that sales have surprised on the upside, a sign of stronger purchasing power. This is a relief given earlier worries that the end of school holidays and the start of the fasting month were nearly back-to-back." they said. CIMB's highlighted companies include departmental store chain Ramayana Lestari Tbk, commercial and industrial supplies company Ace Hardware Tbk and fashion retailer Mitra Adiperkasa Tbk. By 1359 p.m. (0659 GMT), the Jakarta Consumer Index was up 0.4 percent, while the broader Jakarta Composite Index was up 0.05 percent. 1359 (0659 GMT) (Reporting by Andjarsari Paramaditha in Jakarta) **************************************************************** 12:20 STOCKS NEWS INDONESIA-Kim Eng rates Indonesia second-half outlook 'overweight' Maybank Kim Eng rated Indonesian equity market outlook in the second half of the year 'overweight', saying GDP growth came in strong despite deteriorating exports and budget deficits while market valuations allowed room for potential upside. Strong domestic demand drives the economy while low inflation and interest rates will continue supporting consumption and investment in the second half, the research house said. The country still remains a magnet for foreign direct investment, it added. Maybank Kim Eng analyst Katarina Setiawan said corporate earnings growth in the first half is on track, aided by healthy balance sheets with capex remaining strong to support future earnings growth. "Indonesia's market valuations still allow room for potential upside... We like the Consumer Staples, Financials(Bank and Property sub-sectors) and Utilities (Toll Road sub-sector)sectors. Our stock picks represent domestically-driven names with strong pricing power," Setiawan said in a note on Tuesday. Maybank Kim Eng's preferred picks were PT Indofood CBP Tbk , PT Jasa Marga Tbk, PT Summarecon Agung Tbk , PT Bank Rakyat Indonesia Tbk, PT Alam Sutera Realty Tbk and PT Astra Graphia Tbk By 1202 p.m. (0502 GMT), the Jakarta Infrastructure Index , Jakarta Finance Index and Jakarta Consumer Index were down 1.13 percent, 0.28 percent and 0.09 percent respectively, while the broader Jakarta Composite Index was down 0.26 percent. 1205 (0505 GMT) (Reporting by Andjarsari Paramaditha in Jakarta) **************************************************************** 11:11 STOCKS NEWS INDONESIA-Bumi Resources shares slide after S&P downgrade Shares in Indonesia's Bumi Resources, Asia's biggest thermal coal exporter, fell on Tuesday after S&P cut the company's rating on Monday. S&P lowered its rating on Bumi Resources to 'BB-' from 'BB' with a negative outlook, saying the company is unlikely to substantially lower its debt over the next 12 months. "We expect Bumi's operating cash flow to remain weak because of high production and financing costs and taxes, slower-than-anticipated production growth, and lower coal prices, thereby limiting the company's potential to reduce debt." S&P said in statement. "The negative outlook reflects our expectation that Bumi's financial performance is likely to be weak for the current rating over the next 12 months at least." At 1059 am. (0359 GMT) the stock was trading down 3.77 percent at 1,020 rupiah with 35.5 million shares traded, the third highest turnover on the Indonesian stock exchange. The Jakarta Composite Index was down 0.03 percent. 1101 (0401 GMT) (Reporting by Andjarsari Paramaditha in Jakarta) Link this Share this Digg this Email Reprints

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