T

he Jakarta Composite Index (JCI) is moving at high speed, closing up 0.33 percent at 4,811.61, a record high, on Friday.

The LQ45, representing the 45 most active stocks, was also up 0.39 percent. The record close for the benchmark index was boosted by corporate profit disclosures, which will determine dividends.

The new high broke a record set only two days ago, when the JCI ended trading above 4,700 on Feb. 28.

Although the index closed higher, several sectors were down, including agriculture, mining, property and finance, according to the Indonesia Stock Exchange (IDX).

The stocks of big companies, particularly those that have already announced their 2012 financial performance, were big movers on Friday.

PT Astra International, which announced profits of Rp 19 trillion (US$1.96 billion), benefitted the most, with its share price rising 1.89 percent to close at Rp 8,100 apiece.

Astra International was followed by gas distributor PT Perusahaan Gas Negara (PGAS), cement maker PT Semen Indonesia (SMGR) and state-owned lender PT Bank Negara Indonesia (BBNI), all of which have announced increased profits for 2012.

“Everybody is seeking stocks from big companies that will likely pay big dividends,” Edy Kho of UOB Kay Hian Securities said.

Edy said that many foreign investors were purchasing shares in Astra and state-owned telecommunication giant PT Telekomunikasi Indonesia (TLKM).

Astra announced on Thursday that it would pay Rp 216 per share in dividends for 2012.

Although TLKM has not released its full year report for 2012, expectations have been high, as the government has predicted that the total dividends to be paid by state-owned enterprises (SOEs) would touch Rp 33 trillion.

More than 7.31 billion shares exchanged hands on Friday in deals worth Rp 7.87 trillion, far above the IDX’s daily averages for trading volume and value.

Foreign investors pumped in a total of Rp 2.14 trillion into the IDX on Friday, bringing the total net buy year to date to Rp 19.08 trillion.

“Besides the financial reports — some of which were beyond expectations — another factor is a statement from the [US Federal Reserve] that it won’t terminate bond-buying programs earlier than expected,” PT CIMB Securities analyst Mastono Ali said. “It means that investors can take more risks without worries.”

However, the rapid growth of the index would come with corrections, he said. “There are worries that inflation will not decline, although the central bank said that the harvest seasons will lead to a decline in food prices.”

The Central Statistics Agency (BPS) announced on Friday that inflation rose 5.31 percent in February year on year, which was the greatest increase in 20 months.

Edy also warned of profit taking, saying that there would also likely be pressure after the disbursement of dividends in mid-year.

“There is likely to be a 10 to 12 percent correction between March to August, and the index will rise again in the fourth quarter, driven by consumption, enjoying gains after Lebaran,” he said, referring to the holiday that ends Ramadhan, the Islamic fasting month.

The JCI’s year-to-date growth has reached 11.47 percent, trailing the growth of Japan’s Nikkei 225 at 11.65 percent while beating the 10.61 percent growth booked by Thailand’s SET Index.