Local markets continue to gain in strength<\/p>\n
JAKARTA (JP): The Indonesian financial market yesterday sealed
\nthe week's gaining streak with the rupiah strengthening to 14,550
\nagainst the U.S. dollar and the stock market inching up 0.9
\npercent yesterday.<\/p>\n
Analysts attributed the week-long rally to improving
\nsentiment, both at the local and regional levels, as foreign
\ninvestors started selecting quality investments in the region.<\/p>\n
A currency dealer with a local foreign exchange bank said the
\nrupiah strengthened to 14,375 against the U.S. dollar in early
\nafternoon trading before settling at 14,500\/600 at the close.<\/p>\n
The rupiah started the week at 14,800 against the greenback.<\/p>\n
\"It's pretty much following the regional movement, especially
\nthe Japanese yen. Besides, domestically the overall situation is
\nquite stable unless you look at Irian Jaya and East Timor,\" the
\ndealer said.<\/p>\n
Reports said at least one person was killed and two were
\ninjured during a clash between rioters and security forces in
\nIrian Jaya on Thursday, while the situation was still tense in
\nEast Timor following the shooting of an East Timorese man by
\nmilitary agents Monday during a visit by European Union
\nambassadors.<\/p>\n
Overall market sentiment, however, was quite positive
\nyesterday following news reports that the World Bank approved a
\nUS$1 billion structural adjustment loan to Indonesia, currency
\ndealers said.<\/p>\n
The $1 billion loan is part of a $43 billion rescue package
\narranged by the International Monetary Fund (IMF) for Indonesia.<\/p>\n
World Bank Indonesia country director Dennis de Tray said the
\nIMF and the Group of Seven industrial countries would soon
\nannounce additional new loans of $6 billion on top of the
\nexisting package.<\/p>\n
\"That news should give a further boost to the rupiah. We
\nexpect the currency to continue booking gains next week provided
\npolitical stability prevails,\" the dealer said.<\/p>\n
Bank Indonesia Governor Sjahril Sabirin said earlier this week
\nthat political bickering was behind the continuing fall of the
\nrupiah against the U.S. dollar and called on politicians to
\nrefrain from making comments or moves which could undermine the
\ncurrency.<\/p>\n
Share prices on the Jakarta Stock Exchange (JSX) also managed
\nto book slight gains yesterday, with the JSX Composite Index
\nclosing 4.172 points higher at 470.545.<\/p>\n
The market main index was still at 431.231 Monday.<\/p>\n
Yesterday's trading turnover totaled Rp 368.1 million shares
\nvalued at Rp 352.49 billion (US$24.3 million).<\/p>\n
For most of the day, however, shares traded lower as investors
\ncashed in profits after a four-day rally of solid gains,
\nstockbrokers said.<\/p>\n
Bahana Securities associate director and head of equity sales
\nAndre Cita said economic news was predominantly positive this
\nweek, such as an improving trade surplus and the resumption of
\ninternational loans to Indonesia.<\/p>\n
There had not been too many demonstrations on the political
\nfront as well, Cita said.<\/p>\n
\"In that environment, we saw foreign money coming into the
\nmarket and pushing stock prices higher.\"<\/p>\n
Cita noted that most investors coming here were chasing
\nquality stocks which they still considered undervalued.<\/p>\n
In near future, he said, the market may book some rises for a
\ntime before people realized that the economic fundamentals were
\nnot yet strong enough to sustain a rally.<\/p>\n
\"For the short term, people on the sidelines are moving in to
\nparticipate. So, we will see more activity in the market. After
\nthat, I suspect the reality will set in and you will see a
\ncorrection,\" Cita said.<\/p>\n
Heavyweight state-owned domestic telephone firm PT Telkom was
\nunchanged at Rp 4,350 yesterday, while international telephone
\noperator PT Indosat rose Rp 300 to Rp 17,800.<\/p>\n
Cigarettemaker PT Gudang Garam dipped Rp 100 to close at Rp
\n9550, while competitor PT HM Sampoerna gained Rp 25 rupiah to Rp
\n2,375.<\/p>\n
Bank Internasional Indonesia lost Rp 25 to close at Rp 300,
\nwhile state-owned Bank Negara Indonesia remained unchanged at Rp
\n300 and Bank Dagang Nasional Indonesia also stayed unchanged at
\nRp 75. (rid)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/local-markets-continue-to-gain-in-strength-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}