JSX under pressure amid price increases

JSX under pressure amid price increases

JAKARTA (JP): The stock market showed its displeasure to a
number of government-imposed increases in sugar, low-cost houses
and cement reference prices.

By the end of last week, the Jakarta Stock Exchange (JSX)
Composite Index plunged by 9.54 points (2.22 percent) to close at
419.45.

Lower income tax, higher minimum wages and anticipation of
higher property prices and interest rates are expected to
undermine the government's effort to keep the inflation rate low
this year.

More than a few eyebrows were raised when automotive dealer
Tunas Ridean made its surprise announcement to proceed with its
initial public offering, despite the current weak market
sentiments.

Institutional investors applauded the central bank's
announcement to introduce the Jakarta Inter-bank Offered Rate as
a benchmark for local interest rates and an automated Parallel
Information Bond System, which should give the bond secondary
market a much-needed boost.

Domestic investors were moderately active, showing light
buying interests in Indah Kiat and Barito, toward the end of last
week. Other counters which were traded by domestic investors
included Lippoland, Duta Anggada, JIHD and SMART.

Most foreign investors remained on the sidelines. But buying
activities by them were seen on cement counters Semen Cibinong
and Semen Gresik toward the end of the week. Other counters which
saw active trading by foreigners included Indocement, HM
Sampoerna, Astra International, Mayora Indah, BDNI, Gadjah
Tunggal and Lippoland.

Average daily turnover on the regular board decreased to 6.88
million shares, worth Rp 25.20 billion (US$11.34 million), last
week, from 11.24 million shares, worth Rp 38.78 billion, in the
previous week.

Last week's total turnover decreased to 96.31 million shares,
valued at Rp 320.73 billion, from 124.78 million shares, valued
at Rp 455.26 billion, in the previous week.

Some of last week's best performers were Bank Niaga, Tigaraksa
(up Rp 500 each), Bank Rama (up Rp 350), Bank Mashill and Bukaka
Teknik (up Rp 200 each). The biggest losers were Mayora Indah
(down Rp1,100), Berlian Laju Tanker (down Rp 750), Intraco Penta
(down Rp 625), Bank Internasional Indonesia (down Rp 600) and
Suba Indah (down Rp 550). Losers outnumbered gainers by 76 to 26,
while 31 remained unchanged.

Technically, the bear appears to have the dominant grip of the
market over the bull toward the Easter holiday. We see a slight
downward trend in the market, but its near-term support is at
416.

After the holiday, we expect to see a slight upward correction
and the market should hover at that level throughout this week.

-- Sigma Batara