JSX books slight gain in moderate trade

JSX books slight gain in moderate trade

JAKARTA (JP): Prices on the Jakarta Stock Exchange (JSX)
improved fractionally yesterday in moderate trading after losing
ground the previous two days.

But securities brokers said the general mood remained bearish
as investors were still confused by the government's conflicting
signals over its plan to adopt a currency board.

The brokers said most foreign investors remained on the
sidelines, waiting for further clarification about the plan to
peg the rupiah to a foreign currency at a fixed exchange rate.

Octavianus Tedjojuwono, a senior broker with Bahana Securities
said many local speculative investors sold second and third-line
stocks for profit.

He said foreign brokerage houses like Indosuez WI Carr, Credit
Lyonnais, ING Barings, which topped the trading last week, did
not make any big deals.

In contrast local brokerage house like Makindo, Bahana
Securities, Danareksa Sekuritas, Lippo Securities and Trimegah
Securities booked large transactions, he said.

"It is just irrational. Local investors were making massive
speculative trading transactions despite the absence of foreign
ones," he said.

Brokers and analysts said that there were no fresh incentives
to entice foreign investors back to the trading floor.

"I think foreign investors are still confused as there is no
clear indication yet to peg the rupiah to a foreign currency,"
Edhy Widjoyo, an analyst from Mashill Jaya Securities pointed to
a lessening of the pressure from the International Monetary Fund
(IMF) to Indonesia's plan to adopt a currency board system to
stabilize the rupiah.

The JSX Composite Index closed barely higher by 0.39 points to
483.80 from 483.41 points the previous day.

Around 588.78 million shares changed hand on the regular
market valued at Rp 624.06 billion (US$68.57 million).

As stocks remained stagnant, the rupiah ended firmer to close
at 9,050 after opening at 9,250/9,300. The rupiah closed at
9,100/9,300 yesterday.

A chief dealer with a joint venture bank said that the rupiah,
which peaked at 9,000 yesterday in the morning session, managed
to end higher against the American dollar as Singapore operators
unloaded their dollar holdings for the rupiah out of fear that
Indonesia would peg the rupiah to a fixed rate under the currency
board system.

"While Jakarta banks remained calm, Singapore operators made
big dollar sales for the rupiah," the dealer said. (aly)