Pressure on rupiah remains; stocks also down slightly

Pressure on rupiah remains; stocks also down slightly

JAKARTA (JP): The rupiah remained under pressure on Thursday,
closing slightly down at 9,225 against the U.S. dollar, while
stock prices ended the day 0.7 percent lower.

Currency dealers said the rupiah hit an intraday low of 9,350
against the U.S. dollar in the morning following news that
deliberation of political bills in the House of Representatives
had hit a new snag.

Nevertheless, sentiment on the rupiah improved in the
afternoon after reports spread that the House was set to pass the
bills. The rupiah ended the day's trading at 9,225 to the dollar,
slightly lower than Wednesday's close of 9,175.

"The rupiah strengthened once market players started to
believe that the House of Representatives would pass the
political bills on schedule," a chief dealer with a joint venture
bank said.

Dealers said that concerns had escalated over the past few
days after it appeared that deliberation of the political bills
was falling behind schedule, giving rise to fears that the
general election would be postponed.

Currency dealers said that dollar sell-offs by certain state
banks helped the rupiah to advance slightly against the dollar in
the afternoon.

They also warned that long-term sentiment on the rupiah had
not improved and pointed out that concerns over the country's
social and political situation had not abated.

Elsewhere, share prices on the Jakarta Stock Exchange (JSX)
fell 0.7 percent, with the JSX Composite Index closing 2.97
points lower at 407.27.

Trading turnover totaled 363.8 million shares valued at Rp
266.3 billion.

Gainers lead losers by 39 to 38, with 85 shares remaining
unchanged.

Stockbrokers attributed the fall to bearishness on the
regional equity markets and certain investors takings profits
made on blue chip stocks the previous day.

"Our market is again being dictated to by the regional
markets," said an institutional sales broker with Trimegah
Securindolestari.

The broker added that foreign firms which bought blue chip
stocks earlier this week sold of their holdings ahead of the
weekend.

Large-cap stocks ended the day mixed on Thursday, with shares
in the market-leading, state-owned telecommunications firm PT
Telkom falling Rp 125 to close at Rp 3,325 on 10.9 million shares
traded and state-owned international call operator PT Indosat
gaining Rp 125 to Rp 10,375 on 767,500 shares.

Cigarettemaker PT Gudang Garam was down Rp 100 at Rp 10,800 on
257,000 shares traded, while competitor PT HM Sampoerna was up Rp
175 at Rp 5,400 on 3.2 million shares.

Analysts said that investors were watching closely for new
developments in the country's political and social situation,
leaving them with little scope to take a long term view.

"Investors are still afraid to come here because there are so
many uncertainties in all sectors," Mashill Jaya Securities' head
of research Edhi S. Widjojo said. (aly)