Share prices on JSX likely under pressure<\/p>\n
JAKARTA (JP): Share prices on the Jakarta Stock Exchange (JSX)
\ncould be under pressure this week as some foreign investors fear
\nthat the recent devaluation of the Philippine peso will have a
\ndomino effect on the Indonesian rupiah.<\/p>\n
Analysts said over the weekend that local investors would
\nfollow the selling mood, \"not because of the peso news\", but
\nrather because of their concern over the central bank's recent
\nmove to ban new loans for land acquisition and development.<\/p>\n
\"This policy affects not only property developers, but also
\nbanks,\" one analyst said. \"That's why I am quite sure property
\nand bank shares will remain under pressure,\" the head of research
\nat Morgan Grenfell, Digby Falkiner, said.<\/p>\n
The peso devaluation, other analyst said, would only be cause
\nfor concern for foreign investors because they were not really
\nfamiliar with \"our economic fundamentals\".<\/p>\n
The central bank has for several years floated the rupiah into
\na basket of foreign currencies, he said. \"So it is no longer
\nnecessary for Indonesia to devalue its currency like Thailand and
\nthe Philippines did,\" he said.<\/p>\n
\"Indonesia's economy remains stable, so there's nothing to
\nworry about,\" another analyst said.<\/p>\n
The analyst said that Indonesia's stable economic growth and
\nthe long-term nature of foreign debt and controllable short-term
\nprivate debt were factors which could prevent any further
\nspeculation of the rupiah.<\/p>\n
A senior dealer at Asian Development Securities said the
\nbanking stocks which were under profit taking late last week
\nwould continue to decline this week, suffering from the
\ngovernment's new lending policy.<\/p>\n
\"The regulation will translate into the further decline of
\nseveral banking stocks,\" she said.<\/p>\n
She said banks allocated a large amount of credit to property
\nsectors over the past few years and the new policy would hurt
\ntheir annual lending target.<\/p>\n
Besides that, local investors were likely to cash in stocks to
\ngenerate fresh funds for buying new stocks at the primary market,
\nwhere some companies were expected to sell their new shares.<\/p>\n
Companies which are scheduled to make a JSX debut include
\nLautan Luas on July 21, Maharani Finance on July 16, Bank Arya of
\nthe Ongko Group on July 31, and Koey Steel on August 6.<\/p>\n
The JSX Composite Index hit a new record high of 740.83 on
\nTuesday.<\/p>\n
However, the index declined over the following days to close
\nthe week at 723.42 points, down from 736.60 points in the
\nprevious week.<\/p>\n
Average daily turnover and transaction performed differently
\nlast week as the turnover volume decreased while transaction
\nvalue increased.<\/p>\n
Last week the average daily turnover declined 6 percent to
\nonly 312.3 million shares from 332.3 million shares in the
\nprevious week.<\/p>\n
The average daily transaction value rose 9 percent to Rp
\n590.88 billion (US$246.2 million) from Rp 537.7 billion in the
\nprevious week.<\/p>\n
\"The JSX composite index is expected to hover around 715 and
\n720 this week, but won't fall below 700,\" an analyst from a joint
\nventure securities company said.<\/p>\n
Most blue chip stocks lost value last week. State-owned Telkom
\ndropped Rp 250 over the week to close at Rp 3,925, while
\nsatellite-operator Indosat was down Rp 275 to Rp 7,425.<\/p>\n
Cigarette-maker HM Sampoerna lost Rp 575 to close at Rp 9,425
\nwhile competitor Gudang Garam slipped Rp 550 to Rp 9,425.<\/p>\n
Most banking stocks suffered losses last week with Bank Negara
\nIndonesia (BNI) down Rp 50 to Rp 1,525, Bank Internasional
\nIndonesia (BII) losing Rp 150 to close at Rp 1,900, Bank Danamon
\nshedding Rp 100 to close at Rp 1,175, Bank Dagang Nasional
\nIndonesia (BDNI) dropping Rp 275 to Rp 1,425, and Bank Niaga
\nlosing Rp 200 to Rp 6,600.<\/p>\n
Some securities dealers expected foreign funds managers to
\nenter the market in anticipation of better-than-expected second
\nquarter results.<\/p>\n
\"We're waiting for good second quarter results,\" a dealer from
\nAsian Development Securities said. (aly)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/share-prices-on-jsx-likely-under-pressure-1447893297",
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