JSX recovers from speculation

JSX recovers from speculation

JAKARTA (JP): The Jakarta Stock Exchange (JSX) rebounded on speculation by domestic investors at the beginning of last week. The rise was boosted by solid performance on Wall Street and the government's strong intervention to support the rupiah.

The rally, however, burned out towards the end of the week as foreign investors remained the net sellers.

The JSX Composite Index closed the week 4.21 points (+0.95%) higher to 446.08. The market's sentiment was not so strong with the index having dipped below the 450 support level.

The rebound lacked enough steam to push the market well above the previous support level. Foreign investors were skeptical ahead of the U.S. interest rate hike at the end of the month.

In the near term, share prices are likely to be flat as the market is expected to take its direction sideways.

Cigarette producer, HM Sampoerna, reported better than expected results with net profits rising by 130 percent. However, the counter's price did not move much.

The JSX market is already one of the cheapest. However, whether the market can maintain its course will largely depend on local buying which would limit the downside.

Local players reacted more positively, as the government ruled out devaluation and defended the rupiah. Local bargain hunters came in, snapping-up stocks which have become very much undervalued.

Stocks which were actively traded by domestic investors last week included Indosat, Astra Int'l, Barito, Gudang Garam, Sampoerna, Indah Kiat and Indofood.

Demand

Foreign players were the net sellers during the week, putting a lit on rising share prices. However, there was a particular buying interest on Barito Pacific Timber, speculated to benefit from the earthquake in Japan, which would stir a rise in demand for plywood.

Other stocks which were actively traded by foreigners included Indosat, Astra Int'l, Barito, Indah Kiat, Tjiwi Kimia, BDNI, Gudang Garam, Sampoerna, Indofood and Indocement.

Average daily turnover on the regular board decreased to 13.51 million shares worth Rp 47.16 billion (US$21.40 million) last week from 22.41 million shares worth Rp 75.53 billion in the previous week.

Last week's total turnover decreased to 110.14 million shares valued at Rp 414.00 billion from 221.88 million shares valued at Rp 834.07 billion in the previous week.

Some of last week's best performers were Gudang Garam (up Rp 1,200), Sampoerna (up Rp 875), Bunas Finance (up Rp 650), Barito (up Rp 450) and Ugahari (up Rp 400).

The biggest losers were Steady Safe (down Rp 850), Surya Toto (down Rp 700), Tira Austenite, Mulia Industrindo, Modern Photo (down Rp 500 each) and Sepatu Bata (down Rp 450).

Losers outnumbered gainers by 69 to 42, while 35 remained unchanged.

-- Sigma Batara