Mon, 07 Feb 2000

New relief for JSX as coup rumors fade away

JAKARTA (JP): According to stockbrokers, trading on the Jakarta Stock Exchange (JSX) is likely to take further relief this week as investors discount the possibility of the once widely feared military coup.

They said investors reentered the market late last week following firm statements made by senior Armed Forces officials that the military would never attempt to launch a coup against the current legitimate government.

President Abdurrahman Wahid, popularly called Gus Dur, said during his visit overseas last week that a group of generals had met secretly at a house in Central Jakarta to discuss some actions of ill-purpose.

Gus Dur's suspicion was later refuted.

Former leader of a student movement Hariman Siregar said he had attended a meeting in Central Jakarta at Jl.Lautze III, but denied the presence of any generals.

Goei Siauw Hong, the head of research at PT Nomura Indonesia, said that the rumor of a military coup was overblown by the market and now it belonged to the past.

"Investors just realized after all that Wiranto or any other military officials could not afford to attempt such a coup," he said.

He said the country's people would not side with any group perpetrating a coup.

"Fear of a coup was practically gone during the last two days of the week as the market recovered and posted modest gains. Next week the market could improve further," he said over the weekend.

He added that it would not be difficult for the composite index to book a significant gain this week as the Gus Dur-Wiranto standoff would no longer dominate media reports.

An analyst from a state owned securities house said that investors also attentive to the government's effort to sell its stake in automotive giant PT Astra International.

"The opening of the second bidding for the sale of Astra's shares will positively affect the JSX and it will in return build a stronger foreign investors' confidence in Indonesia," he said.

As part of it's efforts to sell its 45 percent stake in Astra International, the Indonesian Bank Restructuring Agency (IBRA) managed to have the company schedule an extraordinary shareholders' meeting on Feb. 8.

At the meeting, once opposed by the company's management, the government intends to reshuffle members of the company's executive board, whom it claimed had blocked its efforts last month to sell the 45 percent stake to a group of foreign investors.

Goei agreed that the sale of the government stake in Astra was good for the market and dismissed worries that the change of Astra top management, as some said, would upset the market and affect the value of the company.

"The strength of Astra management extends to every operations director at its affiliate companies. The change of top management should not reach down to that level," Goei said.

The rupiah, after falling early last week, recovered some of its value late in the week on signs of easing tensions between Gus Dur and Wiranto.

But foreign players still consider holding rupiah to be risky until the Gus Dur-Wiranto tension has been completely resolved.

The JSX composite index advanced a bit last week to close at 634.99 points, up from 634.66 the previous week.

Daily average transaction value dropped to Rp 724.88 billion last week, compared to Rp 1.12 trillion the previous week.

The daily average turnover was cut by half to 614.2 million shares last week from 1.35 billion shares the previous week.

Last week's top gainers were PT Trimegah Securities, whose shares jumped 186.25 percent, PT Adindo Foresta Indonesia by 75 percent and PT Bumi Modern by 44.44 percent.

The week's big losers were PT BAT Indonesia, whose shares fell by 45.61 percent, PT Trafindo Perkasa by 38.10 percent and PT Hotel Prapatan by 34.62 percent.

The top brokerage firms by transaction value were PT Danareksa Sekuritas with Rp 443.40 billion in transactions, PT GK Goh Ometraco with Rp 308.43 billion and PT Trimegah Securindolestari with Rp 286.17 billion.

The rupiah depreciated about 1.6 percent to close the week at 7,520 against the U.S. dollar. (udi)