Market sentiment may remain negative<\/p>\n
JAKARTA (JP): Equity analysts say the planned meeting between
\ntop political leaders in Yogyakarta on Tuesday will not
\nmeaningfully effect share trading on the Jakarta Stock Exchange
\n(JSX) this week.<\/p>\n
The analysts said on Saturday that market sentiment would
\nremain negative despite the gathering of key figures in the
\ncountry's political elite.<\/p>\n
They did not believe that the meeting would be able to ease
\nthe growing domestic political tension ahead of the Aug. 7 annual
\nmeeting of the People's Consultative Assembly (MPR).<\/p>\n
\"Those in the political elite will just be talking nice things
\n(at the meeting). But what is actually happening in the real
\narena is totally different,\" said Mirza Adityaswara of Indosuez
\nWI Carr Securities.<\/p>\n
In an effort to help reduce tension in the run-up to the MPR
\nmeeting from Aug. 7 to Aug. 18, Sultan Hamengkubowono X of
\nYogyakarta has invited the nation's four top political figures to
\na dialog in Yogyakarta on Tuesday.<\/p>\n
President Abdurrahman Wahid, Vice President Megawati
\nSoekarnoputri, House of Representatives (DPR) Akbar Tandjung and
\nMPR Speaker Amien Rais.<\/p>\n
\"Tuesday's meeting is non-event for the market. It is good
\nnews that they plan to meet, and when they really meet there will
\nbe happenings on the market as a result,\" Mirza said.<\/p>\n
He said there were market expectations about the Tuesday
\nsummit, but that if it failed to happen, disappointment could add
\nto the negative market sentiments.<\/p>\n
But Mirza said that the fact remained that relations between
\nthe President and DPR members had been bad since the
\ninterpellation session at the DPR took place two weeks ago.<\/p>\n
\"They (DPR members) are just holding back for the moment,\" he
\nsaid, hinting that things might appear better than the reality
\nuntil a real showdown occurred.<\/p>\n
Any good news for the market this week will be short-lived,
\nbecause medium-term sentiments are negative for the next three to
\nfour months, according to Mirza.<\/p>\n
\"As has been hinted at by a top political figure, the
\nsentiment among legislators to unseat President Abdurrahman is
\nstill around. And the process of unseating the president under
\nthe existing procedures will take between three to four months,\"
\nhe said.<\/p>\n
\"How can we trust any positive news if fears of real political
\nshocks from a change of the country's president linger,\" he
\nadded.<\/p>\n
Sharing pessimism with Mirza, an analyst from a joint-venture
\nsecurities company said the situation was lost, at least until
\nDecember.<\/p>\n
\"I could have been concerned and stressed about the
\ndevelopments up until two weeks ago. But now I can relax because
\nI no longer have anything to worry about, since everything has
\ngotten so bad and unmanageable,\" he said.<\/p>\n
He said Indonesia would continue to carry a heavy economic
\nburden.<\/p>\n
\"The JSX (Composite Index) performance -- in the short and
\nlong term -- will mirror this,\" he said.<\/p>\n
The JSX Composite Index lost two percentage points last week,
\nclosing at 498.80 points from 508.79 points the previous week.<\/p>\n
Its daily average transaction value keeps falling also -- it
\nbooked Rp 228 billion last week, compared to Rp 300 billion the
\nprevious week.<\/p>\n
The daily average turnover, however, increased to 428.7
\nmillion shares last week from some 421 million shares the
\nprevious week.<\/p>\n
It was a similar story at the currency market, where the
\nrupiah was very much unmoved within its narrow range of between a
\nfew tens of points around the 9,000 level, as players worried
\nabout continuing attempts by the President's political opponents
\nto topple him.<\/p>\n
However, some currency dealers said the rupiah would get a
\nboost this week from the government signing of the letter of
\nintent with the International Monetary Fund (IMF), to allow the
\nnext disbursement of the IMF bailout loan package for the
\ncountry.<\/p>\n
The rupiah weakened very slightly last week to 8,970 against
\nthe U.S. dollar, compared to the previous week's close of 8,935.
\n(udi)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/market-sentiment-may-remain-negative-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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