Political protests seen putting pressure on market<\/p>\n
JAKARTA (JP): Reports on escalating antigovernment protests
\nwill likely put more pressure on the country's already ailing
\nfinancial market this week.<\/p>\n
Securities analysts have said that at this stage, a fresh
\ndisbursement from the International Monetary Fund (IMF) would do
\nlittle to help the economy.<\/p>\n
The head of research at Mashill Jaya Securities, Tjandra
\nKartika, said that continued antigovernment protests would negate
\nthe country's painstaking efforts to heal its tattered economy.<\/p>\n
\"How can we expect foreign investors to have confidence in our
\nrecovery if political protests like this continue to take place?\"
\nhe asked.<\/p>\n
Some 1,000 East Timor students rallied Saturday against the
\ngovernment in the provincial capital of Dili and called for a
\nreferendum on self-determination, following similar protests in
\nJakarta the previous day.<\/p>\n
Several groups of students also staged protests last week
\ndemanding the government eliminate corruption, collusion and
\nnepotism.<\/p>\n
Concern over the country's unresolved political uncertainties
\nare casting a shadow on trading activities despite encouraging
\nsignals from the IMF that it will release a new disbursement from
\nits bailout package.<\/p>\n
An economist with Danareksa Sekuritas, Raden Pardede, said the
\nanticipation of a new IMF disbursement would, in a normal
\nsituation, have improved market sentiment.<\/p>\n
\"Now, such an expectation is very much overshadowed by the
\ncountry's unresolved political uncertainties,\" he said.<\/p>\n
The IMF director for Asia and the Pacific said here last week
\nthat the IMF would speed up the disbursement to help the
\ncountry's ailing economy.<\/p>\n
Tjandra said investors were also disappointed over the
\nworsening performance of the country's major companies.<\/p>\n
Most local companies are already too weak to even pay the
\ninterest on their overseas debts because the amount of their
\nforeign debts have more than tripled in rupiah terms.<\/p>\n
The rupiah has plunged more than 80 percent against the U.S.
\ndollar since July last year.<\/p>\n
Tjandra said the capital market's short- and long-term
\nprospects largely depended on the direction of the rupiah, which
\nis predicted to further weaken in the coming days.<\/p>\n
\"I think there is no sign that the rupiah will strengthen
\nagainst the dollar during this political uncertainty,\" Tjandra
\nsaid.<\/p>\n
The rupiah closed at 14,000 to the U.S. dollar Friday, down
\nfrom its close at 11,550 the previous week.<\/p>\n
Trading activity in the local bourse is predicted to remain
\ndormant with most foreign brokerage firms likely to continue
\ndiscarding their stocks linked to Soeharto's family and his
\ncronies.<\/p>\n
\"Investors fear that stocks of companies linked to Soeharto's
\nfamily and his cronies will be worthless,\" a broker with Bali
\nSecurities said.<\/p>\n
The JSX Composite Index fell slightly to 408.37 points last
\nweek from 409.51 the previous week<\/p>\n
The average daily turnover also slid 23 percent to 231.75
\nmillion shares on the regular market from 304.59 million shares
\nthe previous week.<\/p>\n
The average daily transaction also fell 28 percent to Rp
\n238.83 billion (US$17.05 million) last week from Rp 332.87
\nbillion the previous week. (aly)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/political-protests-seen-putting-pressure-on-market-1447893297",
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