Political tensions push rupiah down against dollar<\/p>\n
JAKARTA (JP): High anxiety over the precarious situation
\nduring the Special Session of the People's Consultative Assembly
\n(MPR) weighed heavily on market sentiment on Thursday, with the
\nrupiah closing down at 7,900 against the U.S. dollar and share
\nprices falling 1.3 percent.<\/p>\n
Currency dealers said the rupiah -- which rallied on Wednesday
\ndespite the simmering political tension -- failed to sustain its
\ngains as most market participants were scared to build a new
\nposition.<\/p>\n
\"I think market participants are a bit scared to enter the
\nmarket as the political tension is getting worse,\" a dealer with
\na local private bank said.<\/p>\n
Dealers said the rupiah could have broken through the
\npsychological 8,000 level against the U.S. dollar on Thursday had
\nstate banks not come to its defense.<\/p>\n
The rupiah, which hit an intraday high of 7,650, finally
\nclosed 1.9 percent lower at 7,900 against the American dollar on
\nThursday, compared to Wednesday's 7,750 close.<\/p>\n
Trading volume remained thin as most operators adopted a wait-
\nand-see attitude until the conclusion of the session on Friday.<\/p>\n
As the 1,000 members of the MPR entered the penultimate day of
\ntheir meeting to set new electoral laws and determine the date
\nfor the general election next year, thousands of students and
\nreform leaders stepped up their opposition to the session. They
\nclaim it favors the ruling Golkar grouping and the military in
\nmaintaining the leadership status quo.<\/p>\n
They are also demanding the Assembly scrap the Armed Forces
\ndual socialpolitical role and prosecute former president Soeharto
\nfor alleged massive abuse of power and corruption during his 32-
\nyear rule.<\/p>\n
On Wednesday, 14 people were injured when security personnel
\nclashed with students protesting the session. More clashes were
\nreported on Thursday.<\/p>\n
Dealers said sentiment on the rupiah would remain bleak for
\nthe rest of the week and it was predicted to descend to the range
\nof 8,000 to 8,500 before the weekend.<\/p>\n
Like the rupiah, share prices on the local stock market also
\ndeclined. The Jakarta Stock Exchange (JSX) Composite Index fell
\n5.03 points to 356.98 on a total turnover of 439.12 million
\nshares valued at Rp 454.23 billion (US$57.49 million).<\/p>\n
Losers led gainers by 80 to 20 with 82 stocks unchanged.<\/p>\n
Stockbrokers said that the decline in stock prices was caused
\nby panic selling by investors who feared the growing anti-MPR
\nsession demonstrations would cause chaos.<\/p>\n
\"We still saw some program buying in the morning, but profit
\ntaking and panic selling in the afternoon reversed the
\nsentiment,\" sales manager of Mashill Jaya Securities Antonio
\nYongnata said.<\/p>\n
He said stocks of mining firm Aneka Tambang, Astra Agrolestari
\nand state telecommunication firm PT Telkom, which made gains on
\npreceding days, declined on Thursday.<\/p>\n
The share price of Aneka Tambang shed Rp 50 to Rp 1,475 on
\n9.31 million shares, Astra Agro Lestari slid Rp 50 to Rp 2,275 on
\n877,500 shares and Telkom fell Rp 25 to Rp 2,450 on 38.78 million
\nshares.<\/p>\n
Antonio said investors would likely continue dumping their
\nstocks on Friday ahead of the weekend to cash in profits on gains
\nmade the previous day.<\/p>\n
\"The stock market is likely to decline on persistent profit
\ntaking ahead of the weekend,\" he said. (aly)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/political-tensions-push-rupiah-down-against-dollar-1447893297",
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