JSX drops 3.7% as fuel, tariff hikes hurt market<\/p>\n
Dow Jones, Jakarta<\/p>\n
Indonesian shares ended lower Thursday on a government
\ndecision to raise fuel prices and electricity and
\ntelecommunication tariffs, as well as profit-taking after recent
\ngains, dealers said.<\/p>\n
The Jakarta Stock Exchange Composite Index ended down 3.7
\npercent, or 15.820 points, at 409.125, below the crucial support
\nof 410.<\/p>\n
Decliners led gainers 91 to 16, with 31 stocks unchanged.<\/p>\n
Volume was thin at 203 million shares valued at Rp 217 billion
\n(US$24 million).<\/p>\n
Dealers also said investors took profit following the main
\nindex's gains of around 8 percent over the last few sessions of
\n2002 on year-end window-dressing.<\/p>\n
Wednesday, the government announced hikes in telecommunication
\nand electricity tariffs by an average 15 percent and 6 percent,
\nrespectively. Fuel prices were also raised by between 3 percent
\nand 23 percent.<\/p>\n
\"The price and tariff increase was a good excuse to take
\nprofit,\" said a trader with a local brokerage firm.<\/p>\n
Analysts said the increases in tariffs and prices will hurt
\nthe revenue of many companies in Indonesia this year.<\/p>\n
There are also fears that such increases will lead to
\ndemonstrations, they added.<\/p>\n
Consumer and cement blue chips led the market's fall.<\/p>\n
Cement producer Semen Gresik lost 6.6 percent, or Rp 550, to
\nRp 7,600. Gresik's rival Indocement fell 7.4 percent, or Rp 50,
\nto Rp 625.<\/p>\n
Cigarette maker HM Sampoerna lost 6.8 percent, or Rp 250, to
\nRp 3,450, as players took profit following its recent 21 percent
\nrise fueled by year-end window-dressing. Sampoerna's rival,
\nGudang Garam, declined 4.8 percent, or Rp 400, to Rp 7,900.<\/p>\n
Bellwether Telekomunikasi Indonesia was another decliner,
\nslipping 3.3 percent, or Rp 125, to Rp 3,725, despite the higher
\ntelecommunication tariffs. Dealers said investors had already
\npriced in the hike and took profit after the news was announced.<\/p>\n
Indonesian Satellite was down 4.9 percent, or Rp 450, at Rp
\n8,800, hurt by continued concerns that its workers would stage
\nanother protest against the government's recent sale of a 41.94
\npercent stake in Indosat to Singapore's ST Telemedia.<\/p>\n
Further profit-taking also hit shares in car maker Astra
\nInternational, which fell 7.1 percent, or Rp 225, to Rp 2,925
\nafter surging 45 percent recently.<\/p>\n
The rupiah ended higher against the dollar in volatile trading
\nthanks to alleged intervention by the nation's central bank,
\ndealers said.<\/p>\n
The dollar closed at Rp 8,915, down from its close Monday at
\nRp 8,960. Trading was closed Tuesday and Wednesday for the New
\nYear holiday.<\/p>\n
Dealers said Bank Indonesia was suspected of intervening in
\nthe market when the dollar rose to an intraday high of Rp 8,995
\non the back of demand from local companies.<\/p>\n
Bank Indonesia's alleged intervention discouraged market
\nparticipants from pushing the dollar higher and some even
\nliquidated their dollar-long positions.<\/p>\n
Bank Indonesia has said in the past that it would intervene to
\nhelp the rupiah if it's necessary. But, it won't comment on
\nspecific intervention.<\/p>\n
Dealers added that the market couldn't find a compelling
\nreason to push the dollar higher after the Christmas and New year
\ncelebrations passed without incident.<\/p>\n
Many western countries had issued warnings about the threat of
\nchurch bombings targeting foreigners during Christmas.<\/p>\n
Dealers expect Bank Indonesia to continue to intervene Friday
\nto drive the U.S. unit below Rp 8,900. They expect the dollar to
\ntrade between Rp 8,875 and Rp 8,925 during the last trading
\nsession of the week.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/jsx-drops-37-as-fuel-tariff-hikes-hurt-market-1447893297",
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"sponsor": "Okusi Associates",
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