Share prices fail to sustain Monday's gains<\/p>\n
JAKARTA (JP): Share prices on the Jakarta Stock Exchange (JSX)
\nfailed to sustain their impressive gains yesterday, losing about
\n3 percent due to profit takings and reports of sporadic riots.<\/p>\n
Securities brokers said market sentiment remained bullish in
\nthe morning but profit takings by short-term investors and
\nreports of riots in several towns in East Java and Sulawesi
\nkilled the buying mood.<\/p>\n
The JSX Composite Index, which posted a 1.3 percent gain in
\nthe morning session, sank 17.31 points to close at 536.79.<\/p>\n
The share prices, which gained 14 percent Monday, were very
\nvolatile with many short-term investors taking a profit from the
\nprevious day's gains, while others sold their stocks on fears
\nthat reports of unrest would further worsen confidence in the
\nalready weak economy, analysts said.<\/p>\n
Riots erupted in several towns in Java and South Sulawesi
\nover the last few days, with shops and retailers bearing the
\nbrunt of the mobs' fury, according to newspaper reports.<\/p>\n
The economic crisis gripping Indonesia is leading to massive
\nlayoffs and dramatic price increases, heightening social unrest
\nacross the country. Most of the riots and other disturbances have
\nbeen confined to Central Java and East Java.<\/p>\n
In the foreign exchange market, the rupiah stabilized at
\n9,500\/10,200 against the U.S. dollar at the close following
\nrepeated interventions by the central bank, currency dealers
\nsaid.<\/p>\n
Stock analysts said recent gains in the stock market could
\nprimarily be attributed to the influx of foreign funds into
\nemerging markets, including Indonesia.<\/p>\n
"The market may seem to be bullish but people are still
\ncautious for the mid and long term," said Mohammad Syahrial, head
\nof research at Pentasena Securities.<\/p>\n
The head of research at Socgen Crosby Securities, Goei Siauw
\nHong, said the influx of foreign funds into Indonesia Monday was
\ndriven by market confidence in the recent government economic
\nreforms to improve the country's economy.<\/p>\n
He said, however, the newspaper reports on the riots prompted
\nselling activities, some due to fears that the riots would spread
\nand some because other investors deemed it was time to take a
\nprofit.<\/p>\n
Hong predicted serious unrest in Jakarta in the near period as
\ntwo million residents would soon return to the city after
\nspending their Idul Fitri holidays in their hometowns and
\nvillages.<\/p>\n
"More and more people will return to Jakarta to find no job to
\ncome back to," he said.<\/p>\n
"Things are getting worse for these people as prices of basic
\ncommodities continue to rise," he added.<\/p>\n
"The market long-term view is still bleak. The latest reforms
\nintroduced by the government were solely aimed to improve the
\ncountry's economy in the long term, not in the short run," he
\nsaid.<\/p>\n
An analyst who asked for anonymity said the market mid- and
\nlong-term outlook remained gloomy due to uncertainty over the
\nMarch presidential election.<\/p>\n
He said it was almost certain that Soeharto would remain the
\ncountry's president but if he chose a wrong man as vice
\npresident, it would trigger more problems in the country's
\npolitics and economy. (aly)<\/p>\n
Currencies -- Page 9<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/share-prices-fail-to-sustain-mondays-gains-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }