Panic selling routs JSX<\/p>\n
Rendi A. Witular, Jakarta<\/p>\n
The Jakarta stock market sank further on Thursday for the
\nsixth straight session on panic selling due to a combination of
\nnegative domestic and regional issues, offsetting the record
\ngains made last month.<\/p>\n
The Jakarta Composite Index fell by 1.57 percent or 11.965
\npoints to 746.117 with 1.52 billion shares worth Rp 1.21 trillion
\n(US$139 million) changing hands.<\/p>\n
In just six trading days since it booked a historic record of
\n818.15 on April 27, the Index has plunged by 60.07 points or 7.3
\npercent.<\/p>\n
Bluechip telecommunications firm PT Telekomunikasi Indonesia
\n(Telkom), the bourse's largest counter, led Thursday's disaster
\nby losing Rp 400 to close at Rp 7,500.<\/p>\n
Stock analyst Fendi Susiyanto of BNI Securities said that
\ninvestors had set aside the positive news on corporate
\nperformance, and tracked down negative sentiment on political and
\nsecurity uncertainties ahead of the presidential election.<\/p>\n
\"Most foreign investors were in panic selling mode following a
\nstring of security problems at home, such as the sectarian
\nclashes in Ambon, Maluku, and the recent bombing in Pekanbaru,
\nRiau, that killed two people,\" Fendi said.<\/p>\n
Fendi explained that foreign investors, who now account for 50
\npercent of the average daily transaction value on the market,
\nwere afraid that such problems would escalate ahead of the
\npresidential election on July 5 and the runoff on Sept. 20.<\/p>\n
Foreign-based securities firms, such as JP Morgan and DBS
\nVickers, and local firm Bhakti Capital Indonesia, were the top
\nsellers. JP Morgan sold Rp 218 billion worth of stocks, DBS Rp
\n165 billion and Bhakti Rp 108 billion.<\/p>\n
Foreign investors mostly invest in the country's market via JP
\nMorgan and DBS.<\/p>\n
Fendi also said that China's plan to scale down its investment
\nspending so as to cool down its overheating economy had dealt a
\nblow to the region, including Indonesia, which might lose its
\nrecent export gains to China.<\/p>\n
Indonesian exports, which are expected to emerge as a major
\ngrowth engine, have been increasingly tied to the sharp increase
\nin demand from China.<\/p>\n
A slowdown in the Chinese economy, led by a sharp decline in
\ncommodity demand and prices, would hurt Indonesia relative to its
\npeers in Southeast Asia.<\/p>\n
Stock analyst and president director of Kim Eng Securities,
\nMustofa, concurred with Fendi, saying that the plan by China for
\na slowdown, along with the recent plan by the U.S. Federal
\nReserve to gradually increase interest benchmark rates, had
\nfurther fueled the already negative sentiment.<\/p>\n
\"The Index will remain under pressure due to these problems,
\nand is unlikely to pick up again until after the country has
\nelected a new president,\" said Mustofa.<\/p>\n
\"We simply don't expect the Index to reach 800 again before
\nthe presidential vote, which will ensure political and security
\ncertainty for the market,\" he said.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/panic-selling-routs-jsx-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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