Share prices and rupiah fall again<\/p>\n
JAKARTA (JP): Stock prices on the Jakarta Stock Exchange (JSX)
\nfell again yesterday as local investors awaited the return of
\nforeign buyers.<\/p>\n
Securities analysts said the absence of foreign investors,
\nwhich previously controlled over 70 percent of trading
\nactivities, remained the main factor for the sluggish market.<\/p>\n
\"How can we expect foreign investors to enter the Jakarta
\nstock market while regional markets weaken,\" Fadjar Limin Sutandi
\nof Sigma Batara asked.<\/p>\n
He said American and European investors perceived that the
\nregional markets were still jittery in the face of the currency
\ncrisis.<\/p>\n
Most local investors still found that depositing rupiah in
\nbanks was still more attractive than portfolio investments.<\/p>\n
\"The weakening rupiah is also to blame for the fall of stock
\nprices in the Jakarta stock market,\" a stock broker with a joint
\nventure securities firm said.<\/p>\n
The JSX composite index lost 0.8 percent or 3.09 points to
\nclose at 398.61 yesterday with a total turnover of 264.80 million
\nshares valued at Rp 264.87 billion (US$72.56 million).<\/p>\n
As stock prices lost ground, the rupiah followed suit, sliding
\nbelow the 3,700 level against American greenback yesterday,
\ntriggered by the sharp fall in the Thai baht and the persistent
\nweakness in regional currency markets, foreign currency dealers
\nsaid.<\/p>\n
A chief dealer from a local private bank said that the central
\nbank's intervention to support the rupiah at the 3,710 level
\nduring the midday trading session failed to bring the currency to
\nrecoup against the U.S. dollar.<\/p>\n
\"Bank Indonesia's intervention has not been effective as it
\ncannot keep the rupiah propped up against the dollar,\" he said.<\/p>\n
The dealer said that the amount of dollars selling was not
\nmuch, hovering between $75 million and $100 million.<\/p>\n
\"Given such limited dollar selling, it cannot lift up the
\nrupiah against the U.S. dollar,\" he said.<\/p>\n
He said a joint intervention by Bank Indonesia, along with the
\nBank of Singapore and the Bank of Japan would be effective to
\nshore up the rupiah.<\/p>\n
\"When three banks intervened in the foreign exchange market
\nsome time ago, the rupiah strengthened 300 points. The joint
\nintervention would psychologically affect the market,\" he said.<\/p>\n
Spot rupiah ended lower and closed at 3,715\/25 in late trading
\nyesterday compared with the opening of 3,665\/75 in the morning
\nsession.<\/p>\n
Foreign currency dealers also attributed the weakening of the
\nrupiah yesterday to the high demand by local companies to cover
\ntheir dollar debts. (aly)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/share-prices-and-rupiah-fall-again-1447893297",
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