'Paris Club to boost local market'<\/p>\n
Dadan Wijaksana, The Jakarta Post, Jakarta<\/p>\n
The rupiah will likely resist selling pressure this week, as
\nconfidence from last week's successful Paris Club meeting could
\nshore the local unit to new gains, analysts said.<\/p>\n
Last week's US$5.4 billion debt rescheduling deal with the
\nParis Club creditor countries would bring fresh air to market
\nsentiments, which have been positive over the past weeks.<\/p>\n
The deal puts back sovereign debt payments by over 18 years,
\nand foreign development aid payments by over 20 years.<\/p>\n
Market analysts Ferry Latuhihin and Wiwan Wiradjaja said
\nprolonged positive sentiment would allow the local rupiah to
\nforce its way through to beyond 9,500 against the dollar.<\/p>\n
\"I think, the rupiah will try to test the 9,500 level on the
\nimpact of the successful meeting in Paris, but it (the movement)
\nwill not go too far,\" DBS Vickers analyst Wiwan said over the
\nweekend, estimating the local currency would hover at a range of
\n9,400 to 9,600.<\/p>\n
The rupiah has moved close to around 9,400 on a number of
\noccasions but failed to break through that key psychological
\nsupport.<\/p>\n
Wiwan said that support had been thin at 9,400 but could have
\ngrown strong enough by now.<\/p>\n
The local currency closed higher last week at 9,525 against
\nthe dollar, compared to 9,560 in the previous week.<\/p>\n
Ferry, currency and stock analyst at Danareksa, also predicted
\na stronger rupiah this week.<\/p>\n
Optimism over the country's efforts to speed up the sale of
\nassets, including Bank Niaga, might spur the rupiah's rise, both
\nFerry and Wiwan agreed.<\/p>\n
The Indonesian Bank Restructuring Agency (IBRA) said last week
\nit would announce the names of bidders for a 51 percent stake in
\nPT Bank Niaga, as part of a divestment process the government
\nhopes to finalize by June.<\/p>\n
As in the sale of Bank Central Asia (BCA), Bank Niaga is seen
\nattracting foreign cash, which could again bolster confidence in
\nthe rupiah.<\/p>\n
The country's image before investors was given a boost as the
\ngovernment successfully completed the sale of BCA to a foreign
\nconsortium led by U.S investment firm Farallon Capital Management
\nafter nearly two years of efforts.<\/p>\n
Ferry said the stock market would see some buying among
\nsecond-liners stocks, that could lead the index to new gains.<\/p>\n
Last week, the Jakarta Stock Exchange Composite Index jumped
\nby almost six percent to close at 539.27 points from 509 the week
\nbefore. The latest rise sums up to nearly 40 percent in gains
\nmade since early this year by the Jakarta stock market.<\/p>\n
The past weeks' bullish mood was underpinned by exchange rate
\nstability, falling interest rates, and progress in the sales of
\nbanking shares.<\/p>\n
\"Since prices of most of the blue chips' shares are already
\napproaching their fair-values; players would turn to second-
\nliners,\" Ferry added.<\/p>\n
In last week's trading, market heavyweight telecommunication
\nfirm PT Telkom ended down Rp 200 at Rp 4,475. Its peer PT Indosat
\nwas up Rp 2,450 at Rp 13,400.<\/p>\n
Cigarette maker PT Gudang Garam rose Rp 750 over the week to
\nRp 11,850 and rival PT Sampoerna closed Rp 50 rupiah lower at Rp
\n4,525.<\/p>\n
Last week, daily volume averaged two billion shares valued at
\nRp 1.352 trillion ($141.87 million) compared to the previous
\nweek's 1.468 billion shares worth Rp 704.9 billion.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/paris-club-to-boost-local-market-1447893297",
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