JSX stock trading may keep lethargic<\/p>\n
JAKARTA (JP): Trading on the Jakarta Stock Exchange (JSX) is
\nexpected to stay in a slumber this week as investors continue to
\ntake a wait-and-see attitude.<\/p>\n
Securities dealers and analysts said most investors were still
\nawaiting implementation of the bold reforms announced by
\nPresident Soeharto Thursday.<\/p>\n
\"This will certainly make stock trading less active,\" said one
\nanalyst.<\/p>\n
The reforms cover a wide range of business activities,
\nincluding the end of special privileges for the controversial
\nnational car project, fuel subsidies and price controls on
\nseveral food products.<\/p>\n
They also encourage bank mergers, provide deposit insurance to
\nboost confidence in banks and grant the central bank full
\nautonomy. They also scrap Bulog's monopoly on the import and
\ndistribution of sugar and wheat.<\/p>\n
The securities analysts said the market would have to digest
\nthe measures while watching closely how the government
\nimplemented them.<\/p>\n
\"Though all reforms have met the market requirements, the
\nmarket will have to digest the details of the reforms first,\" a
\nsenior analyst with Bahana Securities said.<\/p>\n
\"The reforms are aimed for long term purposes so do not expect
\nthe market to recover in the near future.\"<\/p>\n
Most analysts welcomed the government's new economic reforms
\nbut warned that their impact would not be felt in the short term.<\/p>\n
Stock brokers said financial markets were still expecting the
\ngovernment to announce details of the reforms in the banking
\nsectors, especially on the merger issue and central bank
\nautonomy.<\/p>\n
\"We expect the government to announce that this week and this
\nwill boost sentiment in the banking sectors,\" the Bahana analyst
\nsaid.<\/p>\n
\"If there is something positive, we will see a positive
\nreaction from the banking industry to this.\"<\/p>\n
An institutional broker with Trimegah Securities said there
\nwas strong interest in banking stock, amid market speculation
\nlast week that the government would soon require private banks to
\nmerge in an effort to boost efficiency.<\/p>\n
\"Most banking stock ended higher last week due to positive
\nsentiment on the merge of private bank,\" the broker said.<\/p>\n
Market talks said Indonesia, which at present has about 130
\nbanks (not including rural banks, actually needs only between 20
\nto 30 healthy and sound banks.<\/p>\n
\"The merge of private banks should become a positive news for
\nthe listed banks though many of them are not in a solid
\nposition,\" head of research of Pentasena Securities Mohammad
\nSyahrial said.<\/p>\n
However, head of research at Sigma Batara Fadjar, Limin
\nSutandi, said the market was still far from its bottom and had
\nyet to consider major concerns on political and social issues
\nresulting from the monetary crisis, which has slashed a large
\npart of corporate earnings.<\/p>\n
Million of workers in the property sector and labor-intensive
\nindustries have lost their jobs in recent weeks.<\/p>\n
\"The monetary crisis has forced most industries to have major
\nlayoffs which will bring about social problem,\" he said.<\/p>\n
\"I personally think that the market will remain low, with the
\nprice index to reach as low as 300 in the coming weeks,\" he said.<\/p>\n
In addition, he said, there was likely to be political tension
\nas the convening of the People's Consultative Assembly approached
\nin March to elect the president and vice president.<\/p>\n
Stock prices on the JSX rose sharply by around 20 percent last
\nweek, with the main price index closing 70.95 points higher at
\n413.920 points from 342.92 the previous week.<\/p>\n
Average turnover increased by around 40 percent to 719.73
\nmillion shares changing hands against 463.85 million the week
\nbefore.<\/p>\n
The average value also increased to Rp 797.67 billion
\n(US$99.70 million) last week from Rp 509.42 billion.<\/p>\n
Most blue chip stocks rose higher last week. State-run
\ntelecommunications firm PT Telkom increased by Rp 1,050 to Rp
\n3,550, satellite operator Indosat by Rp 5,075 to Rp 13,200,
\ntobacco company H.M. Sampoerna by Rp 1,025 to Rp 4,875, Gudang
\nGaram by Rp 1,675 to Rp 8,475, Bank Internasional Indonesia by Rp
\n200 to Rp 500, Bank Negara Indonesia by Rp 100 to Rp 550 and Bank
\nDagang Nasional Indonesia by Rp 25 to Rp 300. (aly)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/jsx-stock-trading-may-keep-lethargic-1447893297",
"image": ""
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"sponsor_url": "https:\/\/okusiassociates.com"
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