Stocks jump on stable political situation<\/p>\n
JAKARTA (JP): Stock prices on the Jakarta Stock Exchange (JSX)
\nrose for a second consecutive day yesterday, with the main price
\nindex gaining 4.4 percent at the close of trading.<\/p>\n
Stockbrokers said foreign and local investors were upbeat with
\nthe stable political and social situation during the General
\nSession of the People's Consultative Assembly to elect a
\npresident and vice president.<\/p>\n
\"Stock trading is active as the market feels secure with the
\nstable political and social situation during the General
\nSession,\" said Surya Martara, head of sales at UBS Securities.<\/p>\n
He said worries over political and social instability had
\nfaded due to the absence of any major social or political
\nprotests during the ongoing Assembly meeting.<\/p>\n
Foreign brokerage houses were mixed during yesterday's trading
\nas some of them, including Jardine Fleming Nusantara, Merrill
\nLynch and Credit Lyonnais, were net sellers while other foreign
\nhouses like Indosuez WI-Carr and OSBC Securities were net buyers,
\nhe said.<\/p>\n
Brokers also said most foreign investors made large purchases
\nof tobacco stocks like Gudang Garam and HM Sampoerna on market
\ntalks that the cigarette makers would increase their retail
\nprices to pair the government plan to reduce its excise tax.<\/p>\n
Gudang Garam's stock price rose Rp 1,375 to Rp 13,725 on a
\ntotal volume of 5.48 million shares, while HM Sampoerna rose Rp
\n900 to Rp 6,625 on a total volume of 7.09 million.<\/p>\n
Stockbrokers also said massive buying by foreign investors on
\noverseas listed companies like PT Telkom, Indosat and Tambang
\nTimah helped revive stock trading in the local market, pointing
\nto arbitrage trading in these stocks which would benefit from
\ndomestic and foreign price differentials.<\/p>\n
Telkom's shares rose Rp 250 to Rp 4,000 on a total volume of
\n12.78 million, while Tambang Timah rose Rp 425 to Rp 7,875 on a
\ntotal volume of 1.03 million and Indosat climbed Rp 675 to Rp
\n13,475 on 551,500 shares.<\/p>\n
The JSX Composite Index closed 21.95 points higher at 518.686
\nfrom 496.72 points the previous day.<\/p>\n
About 922.26 millions shares changed hands on the regular
\nmarket valued at Rp 1.07 trillion (US$120.22 million).<\/p>\n
Stock analysts said yesterday the upbeat sentiment in the
\nlocal market could partly be attributed to market speculation
\nthat the government's \"IMF-Plus\" program would gain support from
\ninternational and domestic investors.<\/p>\n
\"I think the local market perceived that the President's
\naccountability speech on Sunday showed a clear direction of how
\nthe government will deal with the current economic turmoil,\" an
\nanalyst with a local securities firm said.<\/p>\n
The analyst said the market perceived that President
\nSoeharto's \"IMF-Plus\" program, which he announced in his
\naccountability address Sunday, would include large-scale
\nprivatization of state-owned companies, a bankruptcy law,
\nreduction and rescheduling of external debt and the adoption of a
\ncurrency board system to fix the rupiah at a set rate against a
\nforeign currency.<\/p>\n
As stock prices rose, the rupiah remained relatively stable in
\nthe currency market closing at 8,950 against the U.S. dollar,
\ncompared to its opening of 8,750\/8,800 in the morning session.<\/p>\n
Dealers said trade of the rupiah, which closed at 8,850 to the
\ndollar the previous day, remained thin as most operators moved to
\nthe sidelines to wait for the conclusion of the General Session.<\/p>\n
\"I think the rupiah will likely remain below the 10,000 level
\nuntil the end of the meeting,\" a chief dealer with a local
\nprivate bank said. (aly)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/stocks-jump-on-stable-political-situation-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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