Stock market braces for uncertain days ahead<\/p>\n
JAKARTA (JP): Stock prices on the Jakarta Stock Exchange (JSX)
\nare likely to reel from more turbulent days this week as
\ninvestors remain jittery over the country's social catastrophe,
\nstock analysts said.<\/p>\n
The anarchic violence hammering Jakarta and surrounding towns,
\nwhich has resulted in the destruction of many shops and
\nbuildings, will likely scare investors away.<\/p>\n
\"I think the market sentiment will remain bearish as investors
\nare still terrified by the country's social situation,\" one
\nanalyst with a joint venture securities firm said.<\/p>\n
Two days of riots, looting and arson hit Jakarta and
\nsurrounding towns following the shooting of four Trisakti
\nUniversity students at a demonstration on Tuesday last week,
\nbringing all business activities in the capital to a standstill.<\/p>\n
Head of research at Pentasena Securities Mohammad Syahrial
\nsaid that the market would be closely watching this week for the
\ngovernment's action to end the riots, the country's worst social
\nunrest in more than three decades.<\/p>\n
\"Market activities will depend on the way the government
\nhandles the situation,\" he said, adding that a further escalation
\nof tensions would cause more distress to the country's already
\nweak economy.<\/p>\n
\"If social stability is restored, there could be some business
\nactivities in the market,\" he said.<\/p>\n
Thousands of foreigners have fled riot-torn Jakarta in the
\npast few days because of fears over the unrest, which has caused
\nthe deaths of at least 165 people, mostly trapped in the burned
\nmalls.<\/p>\n
Analysts said trading activities in the country's ravaged
\nbourse would therefore worsen because most foreign investors had
\njoined those fleeing.<\/p>\n
\"Do not expect the fresh foreign capital would to return to
\nthe country for a while,\" he said.<\/p>\n
\"I think the index will go down further,\" Pentasena's Syahrial
\nsaid.<\/p>\n
But he warned that certain selective investors would make
\nspeculative trading on the dollar valuations stocks like PT
\nTelkom, Indosat and Tambang Timah this week to benefit from their
\nprice differences in the local and overseas markets.<\/p>\n
The three stocks, whose combined market capitalization account
\nfor about 35 percent of the Jakarta Stock Exchange, are also
\ncrosslisted on the New York and London stock exchanges.<\/p>\n
Syahrial also said that trading activities in the local market
\nwould largely depend on the movement of the rupiah against the
\nU.S. dollar this week.<\/p>\n
\"But there is no reason for the rupiah to strengthen against
\nthe American greenback this week,\" he said adding the hammered
\nrupiah might even fall further against the dollar as there is no
\nsigns yet indicating that the ongoing unrest will cool down.<\/p>\n
As most banks closed on Friday last week, the currency was
\nlast quoted in a wide range between 10,500 and 11,500. The local
\ncurrency was closed at 9,200 the previous week.<\/p>\n
The JSX composite index declined 6.61 percent or 28.74 points
\nto 405.93 during the week from 434.65 the previous week.<\/p>\n
Total average daily turnover declined to 261.92 million shares
\nchanging hands last week from 360.14 million the previous week.<\/p>\n
Total average transaction value declined to Rp 277.35 billion
\n(US$27.73 million) last week from Rp 376.67 billion the previous
\nweek.<\/p>\n
Several blue-chip stock prices closed lower last week. Astra
\nInternational shed Rp 175 to Rp 1,050, Gudang Garam slid Rp 1,375
\nto Rp 7275, HM Sampoerna fell Rp 600 to Rp 3,725, Bimantara Citra
\nfell Rp 275 to Rp 375 and toll-road operator Citra Marga
\nNusaphala Persada (CMNP) shed Rp 125 to Rp 425.<\/p>\n
There were only four trading days last week as the bourse was
\nclosed on Monday in observation of Buddha's Day of Enlightenment.
\nAlthough the JSX management did not close the local bourse on
\nFriday last week, there was no significant trading as most
\nbrokers did not come to the trading floor after brokerage firms
\nand securities companies temporarily closed their activities last
\nweek. (aly)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/stock-market-braces-for-uncertain-days-ahead-1447893297",
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