Stock market expected to recover next year<\/p>\n
JAKARTA (JP): The ailing domestic stock market is expected to
\nrecover only in the second semester of next year as big investors
\nstill need more time to enter the market, according to a market
\nexecutive.<\/p>\n
Felia Salim, a Jakarta Stock Exchange (JSX) director, said
\nhere yesterday that most of the stocks traded on the Jakarta
\nbourse had been very cheap but investors were still wary of
\nreentering the market due to the unfavorable monetary condition
\nboth at home and overseas.<\/p>\n
She said that around 40 percent of the stocks on the JSX had
\nbeen traded below their par value of Rp 500 and around 60 percent
\nhad been traded below their book value as of Nov. 21 this year.<\/p>\n
\"This means that the stocks are cheap already and I think
\nforeign investors with a long-term target will certainly be
\ninterested in buying these stocks,\" she said.<\/p>\n
She said she believed some foreign investors had reassessed
\nthe market and started to selectively buy certain shares,
\nespecially those related to oil, mining and export-oriented
\ncompanies as well as agricultural-based industries.<\/p>\n
\"At least long-term investors will invest in these stocks,\"
\nshe said.<\/p>\n
Among the listed businesses in this category are fish exporter
\nDaya Guna Samudera, salt producer PT Fiskar Agung, PT Davomas
\nAbadi, Tambang Timah, Aneka Tambang and Indosat.<\/p>\n
She said around US$40 billion in funds were in the hands of
\nforeign fund managers across Asia and Europe who were now waiting
\nfor the right time to enter Asian stock markets.<\/p>\n
\"Of these funds, a part will be invested in Indonesia, because
\nthe market is still attractive,\" she said.<\/p>\n
She said that to accommodate more foreign investors in the
\nJakarta stock market, the JSX management had equipped itself with
\nnew facilities to ease trading activities in the market.<\/p>\n
\"We are going to start with scripless trading on the JSX
\nbeginning early next year,\" he said.<\/p>\n
She said that when the scripless trading would be introduced,
\ntrading activities and trading frequencies were expected to
\nincrease.<\/p>\n
\"While other analysts are relatively pessimistic, I'm
\noptimistic with our capital market,\" she said.<\/p>\n
She said that the main price indicator on the JSX had declined
\nsharply by around 40 percent, breaking the psychological barrier
\nof 400-points on Nov. 21 last week to 391.25 points from its
\nhighest ever record of 740.83 points on July 7 this year.<\/p>\n
Yesterday, the JSX Composite index closed slightly higher by
\n0.7 percent or 2.86 points to 398.53 points with a total turnover
\nof around 416 million shares changing hands on the regular market
\nvalued at Rp 343.615 billion ($95.44 million).<\/p>\n
Stock brokers said trading was relatively quiet since there
\nwere no fresh market incentives.<\/p>\n
\"I think trading activities are being driven by rumors rather
\nthan fundamentals,\" a stock broker with BZW Niaga Securities
\nsaid.<\/p>\n
She said the President's call last week for state companies to
\ndisburse one percent of their profits to buy stocks in the
\ncapital market affected psychological factors.<\/p>\n
On Monday, the JSX composite index rose 18.95 points to 410.20
\npoints from last week's close of 391.25. (aly)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/stock-market-expected-to-recover-next-year-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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