Rupiah, stocks to remain under pressure: Analysts<\/p>\n
Dadan Wijaksana, The Jakarta Post, Jakarta<\/p>\n
The local currency and shares will remain under pressure this
\nweek amid lingering negative sentiment that has rocked the market
\nover the past several weeks, analysts said.<\/p>\n
As regards the rupiah, currency analyst Farial Anwar said that
\nmarket sentiment would remain bearish on continued concerns over
\nvarious domestic issues.<\/p>\n
\"Since there is no good news to counter the bad news, the
\npressure on the rupiah will likely to continue this week, keeping
\nthe rupiah above the Rp 9,000 level,\" Farial told The Jakarta
\nPost over the weekend.<\/p>\n
PT Danareksa Sekuritas analyst Ferry Latuhihin concurred,
\nsaying the negative sentiment in the market was such that it was
\nvery unlikely the rupiah would strengthen to below Rp 9,000.<\/p>\n
\"However, it will also not move too far away from that range
\nas Bank Indonesia will step in to intervene,\" Ferry told the
\nPost.<\/p>\n
Last week, the market saw the local currency stumble, breaking
\nthrough the psychological level of Rp 9,000 against the U.S.
\ndollar to close at Rp 9,100, the lowest in two months.<\/p>\n
Aside from unfavorable domestic factors, Farial also said last
\nweek's slump in the U.S. stock market, which caused jitters among
\ninvestors worldwide, would continue to haunt the global market
\nthis week.<\/p>\n
Wall Street nose-dived following a string of accounting
\nscandals involving big U.S. corporations like Enron, WorldCom and
\nMerck & Co., dragging down most stock markets around the world,
\nincluding Jakarta.<\/p>\n
Foreign investors anxiously sold stocks in Jakarta and bought
\ndollars.<\/p>\n
\"This has put the rupiah under pressure,\" Farial said.<\/p>\n
The index closed last week at 479.613, down 13.257 points, or
\n2.7 percent, on the previous week's closing.<\/p>\n
Both Farial and Ferry said that domestic problems,
\nparticularly concerns over possible political friction at the
\nupcoming Annual Session of the People's Consultative Assembly,
\nhad put additional pressure on the rupiah.<\/p>\n
\"Concerns are running high that political tension will disrupt
\nthe country's stability, which thus far been quite good,\" Ferry
\nadded.<\/p>\n
The Annual Session, scheduled for Aug. 1 to Aug. 12, will seek
\nto resolve several sensitive issues, including whether the
\ncountry should adopt a direct presidential election system for
\nthe next election.<\/p>\n
Negative sentiment caused by the above factors will also weigh
\nheavily on the stock market, according to analysts.<\/p>\n
\"Uncertainty in stock markets around the world will linger.
\nThis will affect our market's performance,\" Jasso Winarto of
\nSigma Research Institute told the Post over the weekend.<\/p>\n
The index will continue hovering below 470 point, with the 450
\nlevel being the next target, he added.<\/p>\n
Daily volume last week averaged 368.96 million shares worth Rp
\n296.6 billion (US$32.9 million) compared to the previous week's
\n767.44 million shares valued at Rp 535.2 billion.<\/p>\n
State-owned telecommunications firm Telkom lost Rp 50 over the
\nweek to close at Rp 3,700 while state-owned international call
\noperator Indosat lost Rp 700 to close at Rp 10,300.<\/p>\n
Cigarette maker Sampoerna was flat over the week at Rp 4,100
\nwhile rival Gudang Garam was down Rp 200 at Rp 9,550.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/rupiah-stocks-to-remain-under-pressure-analysts-1447893297",
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"sponsor": "Okusi Associates",
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