Mega hails JSX's positive response
Dadan Wijaksana, The Jakarta Post, Jakarta
President Megawati Soekarnoputri paid an unscheduled visit to the Jakarta Stock Exchange on Wednesday, thanking the market for its positive response during the largely peaceful legislative elections.
On Tuesday, a day after the first-round of elections took place, the market's composite index rose.
"I express my appreciation to the Jakarta stock market for its positive reaction to the elections, which took place peacefully," Megawati told traders and dealers during her brief visit.
Coordinating Minister for the Economy Dorodjatun Kuntjoro- Jakti, Minister of Home Affairs Hari Sabarno and Minister of Forestry M. Prakosa accompanied Megawati.
Indonesia held its second elections on Monday after the fall of former strongman Soeharto, who had ruled the country for 32 years.
The process was generally trouble-free with exceptions in some parts of the country. The stock market reacted on Tuesday with a 2.8 percent rise, the largest single-day gain since Feb. 6.
Wednesday's visit to the JSX was Megawati's second this year, having rung the bell on Jan. 5 to mark the start of 2004 trading.
Commentators saw Megawati's visit as an attempt to highlight her leadership, during which the stock market had recovered to pre-crisis levels. The market's performance is a vital element in gauging investor sentiment.
When Megawati became president in July 2003, the share index was hovering under 400 points, well below the current level of more than 700 points.
Megawati said the progress was the result of "a process of reform and democracy, under which political problems do not interfere with economic ones."
Megawati said she was confident the presidential election would be just as smooth as the legislative one and give a further boost to the economy with investor confidence returning.
Dorodjatun agreed, saying the country could expect more investments from overseas due to the elections. "In the stock market, foreign investors are already net buyers, while investors who previously took a wait-and-see position have begun to return," he said.
The direct presidential election is scheduled for July 5 and if the winner fails to secure a clear majority of voters a second round of voting will take place on Sept. 20.
On Wednesday, the market retained its momentum to close higher at 774.39, a 0.4 percent increase from Tuesday, on volume of 1.79 billion shares valued at Rp 1.31 trillion (US$152.6 million).
The country's state telecommunication firms Telkom and Indosat led the rise, gaining Rp 300 and Rp 325 respectively. Telkom closed at Rp 7,950 while Indosat finished at Rp 4,250.
In the currency market, the rupiah ended flat for the second consecutive trading day at 8,575 to the greenback, defying trends in the region that saw most of the currencies fall victims to the dollar's renewed strength.