Analysts predict higher stack prices at JSX this week<\/p>\n
JAKARTA (JP): Stock prices on the Jakarta Stock Exchange (JSX)
\nthis week are expected to benefit from the announcement of the
\nstate budget and the continued window dressing activities,
\nanalysts and stockbrokers said over the weekend.<\/p>\n
They said the announcement of the state budget by President
\nSoeharto tomorrow evening would boost the investors sentiment to
\nenter the market aggressively.<\/p>\n
"The main focus this week will be on the state budget which is
\nto be announced by President Soeharto on Tuesday," Karman
\nPamurahardjo of Harita Securities said Friday.<\/p>\n
Analysts and stockbrokers said window dressing activities
\nwhich had started late last month would continue this week as
\nsome funds managers wanted to make their financial portfolio look
\ngood.<\/p>\n
"I think window dressing will still dominantly mark the
\ntrading activities on the stock market this week," said a broker
\nwith Trimegah Securities.<\/p>\n
Analysts said the announcement of the state budget and window
\ndressing would give positive moves on trading activities this
\nweek. But stock trading would still be overshadowed by the
\nweakening rupiah.<\/p>\n
Analysts have been speculating on the size of the budget,
\nwhether it would be larger than last year's budget in rupiah
\nterms.<\/p>\n
Some analysts are expecting to see severe cuts in spending in
\nthe new state budget to cope with the current monetary crisis.<\/p>\n
The government said previously that it would make the budget
\nproduce a surplus of at least 1 percent of the country's gross
\ndomestic products.<\/p>\n
But later, President Soeharto said that the government would
\nmaintain balanced budget principles in the 1998\/1999 budget,
\ndismissing severe cuts in spending.<\/p>\n
Brokers said many local short-term investors were expected to
\nflock the stock market on Monday, expecting most stocks to rise
\nafter the announcement of the state budget.<\/p>\n
They said banking stocks would continue to get some push,
\nfollowing the government's announcement last week to merge four
\nstate banks into a new healthier bank by mid-1998.<\/p>\n
"Banking stocks were among the active stocks last week and
\nsuch positive sentiment on banking stock is expected to continue
\nthis week," a stock analyst.<\/p>\n
But most analysts agreed that overall market sentiment would
\nremain weak due to the persistent weakening of the rupiah against
\nthe American dollar on the currency market.<\/p>\n
Most analysts said that they were still greatly concerned by
\nthe persistent fall of the rupiah against the greenback.<\/p>\n
On the first trading day for 1998, Friday, the rupiah dropped
\nbelow the 6,000 barrier on a persistent corporate demand for the
\ngreenback.<\/p>\n
Spot rupiah closed the week at 5,850\/5,925 to the dollar.<\/p>\n
"With the rupiah continue to weaken against the dollar, the
\noverall mood for the stock prices on the stock market will remain
\ngloomy," Harita's Karman said.<\/p>\n
The JSX Composite index increase 13.48 points higher to 410.01
\nlast week from 396.53 the previous week.<\/p>\n
Total average turnover was 488.05 million shares changing
\nhands on the regular market against 407.37 million shares the
\nprevious week.<\/p>\n
Average daily trading value was Rp 417.14 billion (US$69.5
\nmillion) last week, compared to Rp 398.63 billion in the previous
\nweek.<\/p>\n
Most large cap stocks gained ground last week. State
\ntelecommunications PT Telkom rose by Rp 150 to Rp 3,075, Indosat
\nby Rp 300 to Rp 10,500, cigarettemaker Sampoerna by Rp 225 to Rp
\n4,375 and Gudang Garam by Rp 425 Rp 8,800.<\/p>\n
Banking stocks also made some gains, with Bank International
\nIndonesia rising Rp 25 to Rp 350 and Bank Negara Indonesia by Rp
\n25 to Rp 550. (aly)<\/p>",
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