Share trading at JSX remains bearish<\/p>\n
By Wachyudi Soeriaatmadja<\/p>\n
JAKARTA (JP): Foreign investor pullout from the Jakarta Stock
\nExchange (JSX) is expected to continue this week as they size up
\ntheir holdings in technology stocks in other exchanges in the
\nregion, equity analysts have said.<\/p>\n
Bhakti Investama's Budi Ruseno said over the weekend,
\n\"Portfolio rebalancing by foreign investors from Indonesia to
\nmore attractive markets in the region will continue next week.\"<\/p>\n
Budi said the decrease in Indonesia's weighting in the Morgan
\nStanley Composite Index (MSCI) was a negative factor last week
\nand would be so again next week.<\/p>\n
Indonesia's MSCI weighting was reduced recently from 2.5
\npercent to 1.7 percent, causing many foreign investors here to
\nmigrate to neighboring Malaysia, Hong Kong and Thailand.<\/p>\n
International investors use the index to determine the
\nrelative portion of investment portfolio allocation among
\ncountries in which they invest.<\/p>\n
However, discounting the MSCI effects, an analyst from a
\nforeign securities house said there was a deliberate move by
\nmajor foreign fund managers to depress the share prices for their
\nown future purpose.<\/p>\n
\"These big foreign funds are interested in buying state assets
\nwhich will put on sale by the Indonesian government through the
\nJSX,\" he said.<\/p>\n
They sold their blue chip shares to make a selling pressure to
\nother stocks, he said, especially those of state-owned companies
\nwhich have been put on the government's privatization list.<\/p>\n
\"This strategy will enable them to buy government stocks at
\nstate companies at cheap prices,\" he said.<\/p>\n
The government has plans to further divest its shares in
\npublicly listed companies, including PT Astra International
\nautomotive company, PT Semen Gresik cement producer, PT Aneka
\nTambang general mining company, PT Telkomsel and PT Indosat.<\/p>\n
Budi said the Composite Index would range between 503 points
\nand 560 points this week, but that early during the week it would
\nmove in a narrower range of between 528 points and 550 points due
\nto a technical rebound.<\/p>\n
\"In general, the market will be mixed next week,\" he said over
\nthe weekend.<\/p>\n
Budi said that a rally in select blue chips late last week was
\nlikely to continue early this week as a technical rebound was a
\nnormal thing after more than two weeks of the index continually
\nlosing ground.<\/p>\n
\"An unsustainable technical rebound early next week is most
\nlikely,\" he said over the weekend.<\/p>\n
Big shares which had lost a lot of their value for the past
\nweeks would be the target of investors' hunt early this week, he
\nadded.<\/p>\n
The rupiah, according to currency dealers, would have to
\ncontinue to bear the burden from the weak sentiment on the JSX.<\/p>\n
A dealer said over the weekend, \"The rupiah will be pressured
\nby some dollar buying next week as offshore funds are being
\nshifted out of the country.\"<\/p>\n
The rupiah ended weaker last week against the U.S. dollar at
\n7,448, compared to 7,408 the previous week.<\/p>\n
The JSX Composite Index dropped 3.5 percent last week to close
\nat 548.55 points, down from 568.55 the previous week. The daily
\naverage transaction value during the four-day week increased to
\nRp 703.11 billion last week, compared to Rp 622.57 billion the
\nprevious week.<\/p>\n
Meanwhile, treasury bonds traded on the Surabaya Stock
\nExchange (SSX) recorded no transactions for the past two weeks.<\/p>\n
It booked transactions worth Rp 6 billion in the three-year
\nfloating rate bonds, priced at 96 percent of the bond face value
\nthree weeks ago.<\/p>\n
According to SSX Fixed Income Trading Manager Erna Dewayani,
\nthe transaction was not made last week as the best bid price fell
\nshort of the asking price put out by the bond issuer.<\/p>\n
\"The best bid last week was only at 95.5 percent of the face
\nvalue against the best asking price of 97 percent,\" Erna said.<\/p>\n
The SSX traded Rp 2.16 trillion of the total Rp 255 trillion
\ntreasury bonds issued by the government last year to finance
\nrecapitalization costs of the country's ailing banks.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/share-trading-at-jsx-remains-bearish-1447893297",
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