Rupiah gains ground but stocks keep on falling<\/p>\n
JAKARTA (JP): The rupiah gained ground closing firmer on
\nWednesday at 8,650 against the U.S. dollar despite a fall in the
\nJapanese yen and other regional currencies.<\/p>\n
Currency dealers said that the rupiah, which was traded in
\nmoderate volume, moved in an isolated upward trend as massive
\nintervention by the central bank kept the rupiah afloat.<\/p>\n
\"Massive dollar offerings by state banks bolstered sentiment
\non the rupiah,\" a chief dealer with a joint venture bank said.<\/p>\n
Dealers said that the rupiah, which opened at 8,700, managed
\nto hit an intraday high of 8,525 due to dollar unloading by
\nseveral state banks and offshore operators, especially from Hong
\nKong, who feared that Indonesia could soon adopt a currency board
\nsystem (CBS).<\/p>\n
\"Market fear that Indonesia will adopt the CBS is forcing some
\nmarket operators to sell their dollars,\" the dealer said.<\/p>\n
Prominent economists, Johns Hopkins professor Steve Hanke,
\nMerton Miller of the University of Chicago and Christopher Culp,
\ndirector of Risk Management Services have called again on the
\nIndonesian government to try a currency board system to rebuild
\nthe country's devastated economy.<\/p>\n
Those fears abated in late trading but forced the rupiah to
\nend slightly lower at 8,650 as domestic corporate demand for the
\ndollar remained high to service offshore obligations.<\/p>\n
\"Though the rupiah seemed to gain ground, uncertainties remain
\nvery high and the rupiah's strong stance doesn't suggest a
\nrecovery of confidence,\" another chief dealer said.<\/p>\n
Dealers said that the rupiah remained bearish with the trading
\nband expected to remain between 8,500 and 9,000 in the coming
\ndays.<\/p>\n
Unlike the rupiah, share prices on the local stock market
\nedged down slightly on Wednesday with the Jakarta Stock Exchange
\n(JSX) composite price index losing one percent to 398.68 points
\non total turnover of 137.09 million shares valued at Rp 141.91
\nbillion changing hands.<\/p>\n
Decliners led advancers 49 to 33 with 78 stocks remaining
\nunchanged.<\/p>\n
Stock brokers attributed the fall in the local stock market to
\na general fall in the other regional equity markets led by a 1.7
\npercent fall on Wall Street and profit taking on blue chip stocks
\nthat gained ground the previous day.<\/p>\n
\"The fall on Wall Street forced us not to expect too much on
\nWednesday,\" Vonny Juwono, an institutional sales broker with
\nTrimegah Securindolestari said.<\/p>\n
Adding to the general fall in the regional market was lively
\nprofit taking in most blue chip stocks. Investors quickly
\nrealized their gains had also increased the pressures on share
\nprices on the local market.<\/p>\n
\"Trading activities have been based on short-term speculative
\nstrategies ... people will just go in and out to make profits,\"
\nFitri Murniati, a stock analyst with BNI Securities said.<\/p>\n
Stock brokers said that foreign investors, who had placed
\nfunds on certain big-capitalized stocks in previous days had
\ndiscarded their portfolio holdings to speedily cash in their
\ngains before losing their investment here.<\/p>\n
Several joint venture brokerage firms such as ING Barings,
\nAsia Equity, Credit Lyonnais, Merrill Lynch Indonesia and Jardine
\nFleming Nusantara were net sellers on Wednesday.<\/p>\n
Share prices of blue chip stocks such as international call
\noperator PT Indosat slid Rp 500 to Rp 12,000 on 1.2 million
\nshares traded, as investors pulled out fearing investment losses.<\/p>\n
Indosat was reported to have invested Rp 106 billion in
\nCanada's AlphaNet Telecommunications Corp. which filed for
\nbankruptcy earlier this week. The company set aside Rp 29 billion
\nin anticipation of the loss last year. (aly)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/rupiah-gains-ground-but-stocks-keep-on-falling-1447893297",
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