Jakarta stocks seen falling this week

Jakarta stocks seen falling this week

Agence France-Presse, Jakarta

The Indonesian stock market is expected to fall this week as high stock prices and political uncertainty after the April 5 legislative election dampen sentiment, an analyst said on Friday.

"Stocks are overbought, meaning that prices are already high so technically sentiment is negative," said Haryajid Ramelan of Rifan Financindo Sekuritas.

"The index is likely to go lower next week considering the political situation. I mean the vote count is not finished yet and things are still vague."

He said a weaker rupiah and an absence of fresh news could also further dampen sentiment.

The Jakarta Stock Exchange composite index closed on Friday at Rp 776.572, down 3.045 points on the previous week's close on April 8.

Average daily volume was 1.74 billion shares worth Rp 730.89 billion (US$84.9 million).

Meanwhile, Japanese shares are likely to stay flat to weaker this week on expectations the U.S. central bank will raise interest rates to pre-empt any inflationary pressure, analysts said.

Speculation the U.S. Federal Reserve will tighten credit sooner rather than later may weigh on the headline Nikkei-225 index, which often take cues from performance on Wall Street, also hit recently by the rate talk, they said.

However, Japanese stocks should receive support from announcements of corporate earnings for the year to March, which are largely expected to show upbeat results in line with the current recovery in the domestic economy, brokers and strategists said.

Last week, the Nikkei-225 index of the Tokyo Stock Exchange fell 72.95 points or 0.61 percent to 11,824.56.

In contrast, the broader TOPIX index of all first section issues gained 5.32 points or 0.45 percent to 1,196.18.

The Stock Exchange of Thailand is expected to surge bolstered by the release of banking and finance sector first quarter earnings, dealers said.

"I think that the index could go on to test 720-point mark on the back of better than expected banking earnings, coupled with the fact that the Songkran holiday passed without any incident," Teerada Charnyingyong, investment Strategist at Phillip Securities said.

The Stock Exchange of Thailand composite index soared 20.81 points or 3.00 percent over the two-day trading week to close on Friday at 712.20.

In Hong Kong, share prices are likely to stabilize after heavy losses on expectations of an interest rate risk in the U.S., dealers said.

The Hang Seng Index lost 450.99 points or 3.50 percent to end the week at 12,458.38 on Friday.

Singapore shares are expected to further take a breather before resuming its uptrend on the strength of projected strong economic growth this year, dealers said.

The benchmark Straits Times Index closed at 1,853.99 on Friday, down 47.93 points or 2.52 percent from the previous week.

"The index has retreated quite a bit from earlier this week but we do believe there is a bit more room for consolidation going forward before we see a clear uptrend," a dealer at a local brokerage said.

In Kula Lumpur, a selldown in the past week that saw Malaysian share prices tumble 2.4 percent may spur some bargain hunting in the days ahead but little fresh buying is expected amid fears of an interest rate hike, an analyst said on Friday.

Mercury Securities senior analyst Victor Wan said the market had consolidated at a quick pace, by about seven percent since the key index peaked at 919 points a month ago, making its valuation more attractive.

The Kuala Lumpur Stock Exchange composite index closed at 861.81 points on Friday, down 21.28 points from the previous week.

South Korean stocks will likely see lackluster trade with the market expected to lose ground in the absence of fresh leads, dealers said.

They said the tone was set by Friday's sharp 1.9 percent loss as investors took record results from Samsung Electronics as a good opportunity to cash in on recent gains.

For the week, the market fell 0.72 percent to 898.88 points on average daily trade volume of 400.75 million shares worth 2.98 trillion won ($2.57 billion), compared with 444.1 million shares worth 2.78 trillion won the previous week.

Australian shares are expected to struggle this week, with investors spooked by a profit warning from Australia's largest bank and the prospect of an earlier-than-expected U.S. interest rate rise, dealers said.

The benchmark SP/ASX 200 index finished the week down 33.3 points or 0.97 percent at 3,417.3 while the All Ordinaries lost 32.3 points at 3,424.3 points.