JSX index rises 0.3 percent

JAKARTA (JP): Share prices on the Jakarta Stock Exchange (JSX) began the week discouragingly, with the Composite Index rising 0.3 percent yesterday.

Securities analysts attributed the rise to increased presence of foreign investors.

Foreign investors seemed to be more confident of Indonesia's economic fundamentals and placed big orders on heavyweight stocks, one analyst said.

"The macroeconomic indicators are improving. This has encouraged foreign investors to enter the market," a director of Morgan Grenfell, Adnan Tan, told The Jakarta Post yesterday.

The JSX composite index rose by 2.12 points to close at 675.81 with 283.75 million shares changing hands at a total transaction value of Rp 624.67 billion (US$260.27 million).

Economic indicators released by the government last week revealed the foreign exchange reserves held by the central bank in April were US$20.4 billion. This was sufficient to finance 5.3 months of imports. Inflation was checked at 0.56 percent in April in comparison to 0.8 percent in April last year.

Tan said that with such large foreign reserves, foreign investors would feel more confident about injecting more funds into the market.

"Foreign investors are likely to continue to enter the market despite reports of small political disturbances during the campaign," he said.

Tan said he was upbeat that the JSX price index would break the psychological 700 barrier soon after the May 29 election.

Foreign investors made particularly big purchases on blue chips because of their undervalued prices, one broker said. "When the election is over, the price of the blue chips will be expensive," he said.

Most blue chip stocks rose higher yesterday except PT Telkom.

The telecommunications firm's shares fell Rp 25 to close at Rp 3,825, while Indosat rose Rp 225 to Rp 7,325, Cigarette maker Sampoerna rose Rp 250 to Rp 10,250 and Gudang Garam nudged up Rp 75 to Rp 10,625.

Bank Negara Indonesia remained unchanged at Rp 1,550 while Bank Internasional Indonesia rose Rp 50 to Rp 1,925 and Bank Dagang Nasional Indonesia climbed Rp 25 to Rp 2,600.

In the currency market, the Indonesian rupiah was firmer against the dollar in slow late trading yesterday on fears of a liquidity press later this week, dealers said.

A dealer said players seemed to switch to liquidity issues in the afternoon, rebuffing worries over the heated campaign for the May 29 general elections.

Spot rupiah was at 2,426.5/27.0 in afternoon trading after opening at 2,426.5/27.5. (09)