JSX hits by heavy falls on Wall Street

JAKARTA (JP): Share prices on the Jakarta Stock Exchange (JSX) plunged yesterday after heavy falls on Wall Street.

"Like other regional markets, the JSX was also affected by the fall in Wall Street prices," one broker said.

The benchmark JSX index fell 10.22 points or 1.5 percent to 652. The market was closed Monday because of the end of the 1996/97 fiscal year.

The increase in local interest rates was also a factor which discouraged trade, another broker said.

Major local banks have begun lifting interest rates by between 50 and 100 basis points after last week's rise in the U.S. discount rate.

Just 145.401 million shares were traded compared to 306.18 million the previous trading day. The value of shares traded was Rp 303.53 billion.

Yesterday, decliners lead gainers 93 to 37 with 51 unchanged.

An ING Barings Securities analyst said besides the fall on Wall Street, lower-than-expected profits by some blue chips also pulled the market down.

"Some blue chips have revised downward their 1997 targets," he said.

"Sampoerna, for example, has revised downward its target," he said.

He said stocks like Telkom, Indofood and Indocement still had some problems.

"The issues of the entry of a new company into PT Telkom service was still there, though it was negated by PT Telkom," he said.

He said Indofood was troubled by its expensive Rp 1.55 trillion acquisition of nine subsidiaries.

"The investors were not satisfied with such expensive acquisition plan," he said.

Most blue chip stocks dropped yesterday. PT Telkom fell Rp 125 to Rp 3,550, HM Sampoerna Rp 375 to Rp 10,875, BNI Rp 25 to Rp 1,350 and Lippo bank Rp 50 to RP 2,350

Indosat rose Rp 25 while Gudang Garam was unchanged at Rp 10,475.

Among second line stocks to drop were Lippo Karawaci by Rp 125 to Rp 3,150, Lippo Land Development by Rp 125 to Rp 3,050 and Lippo Securities Rp 50 to Rp 1,400.

Yesterday's gainers included Modern realty which surged Rp 300 to Rp 3,600, Prima Alloy by Rp 200 to Rp 4,375, Zebra Nusantara by Rp 175 to Rp 3,325, and Astra International by Rp 50 to Rp 5,950. (09)