JSX to be quiet due to religious holidays

JAKARTA (JP): The religious holidays on Tuesday and Thursday will drive trading activities on the Jakarta Stock Exchange (JSX) to a very quiet state this week, according to equity analysts.

"This week's trading will be very slow, affected by the two holidays during the week," head of research at state BNI Securities Adrian Rusmana said.

Analysts predicted the JSX would see few active traders as each trading day this week would be in between non-trading days.

Adrian said trading on the JSX would be sluggish this week, but he did not expect the Composite index to be deeply depressed as a result.

"The (Composite) index will decline during next week, but the slide will not be a steep one as there will only be a few participants," he said.

Adrian said people here did not like to work on days that were surrounded by holidays and preferred to take those working days off for a straight, extended vacation.

An analyst from another state securities house, Joseph Ginting, agreed with Adrian, saying he had a bearish view of JSX for next week, but not for the longer-term, as in a term of three months.

"We are currently getting some incentive-deterring news which for the time being will linger in the market," he said.

He said the government's problems with the International Monetary Fund (IMF) and the rumors of a major Cabinet reshuffle were the negative factors for the market this week.

The IMF said last week that since the Indonesian government had not met the targets of its economic reform, the next disbursement of its loan to the country would be delayed until mid-May.

Meanwhile, rumors spread that president Abdurrahman Wahid -- utterly disappointed with the performance of his economic team -- might replace some Cabinet members after the IMF review of the reform programs were completed sometime in the middle of this month.

Joseph said a major change in the economic team would not be good for the market.

"The market will perceive the Cabinet reshuffle as a signal to the instability of the country's politics," he said.

He said the government's problem with the IMF and the Cabinet reshuffle rumors would also depress the rupiah's value against the U.S. dollar, as happened last week.

"There is fear that further weakening of the rupiah next week will drag down the (Composite) index as well," he said over the weekend.

Adrian concurred, saying over the weekend that "The rupiah may move lower than the important psychological level of 8,000 after it breached the 7,500 level last week."

However, managing director of PT Bank Buana Indonesia Pardy Kendi disagreed that the weakening of the rupiah last week was merely due to the IMF loan disbursement delay and the Cabinet reshuffle rumors.

"The rupiah's drop last week was caused largely by currency players' disappointment that there was no massive buying of the rupiah by IBRA (the Indonesian Bank Restructuring Agency) as expected following the US$506 million Astra share sale," he said.

He said currency players had a short position for the dollar in anticipation of IBRA's conversion of its $506 million into rupiah. But when it failed to realize that last week most players quickly covered their dollar short position, thus creating a shock to the rupiah's value, according to Pardy.

"It is very suspicious that the $506 million has not been converted into rupiah, when the government needs the money in rupiah to cover its deficit budget spending," he said.

The rupiah closed the week down at 7,620 as compared to its previous week close at 7,450.

The JSX Composite Index meagerly increased by 0.3 percent last week to close at 583.27 points, up from 581.47 the previous week. And the daily average transaction value increased to Rp 670.33 billion, compared to Rp 599.72 billion the previous week.

The daily average turnover increased to 591.7 million shares, from 457.2 million shares the previous week.

Last week's top gainers were PT Surya Intrindo Makmur, whose shares jumped 80.00 percent, PT Aqua Golden Mississippi by 45.38 percent and PT Sinar Mas Multiartha by 36.36 percent.

The week's big losers were PT Toko Gunung Agung, whose shares fell by 32.61 percent, PT Bakrieland Development (down by 28.57 percent) and PT Maskapai Reasuransi (down 25.33 percent).

There were two new companies listed on the JSX last week, PT Surya Intrindo Makmur and PT Kridaperdana Indahgraha.

The top brokerage firms by transaction value were PT Bhakti Investama with Rp 335.49 billion in transactions, PT Vickers Ballas Tamara with Rp 236.57 billion and PT Credit Lyonnais with Rp 227 billion. (udi)