Rupiah and local stocks inch higher
Rupiah and local stocks inch higher
JAKARTA (JP): The rupiah escaped the fallout from the sliding
yen and managed to inch higher on Tuesday as stock prices
rebounded slightly, currency dealers and stockbrokers said.
Currency dealers attributed the rupiah's continued recovery to
dollar selling by domestic state banks and market talk of a
possible further U.S. interest rate cut by another 0.25
percentage basis points in the coming weeks.
"This time the rupiah did not follow the movement of the
Japanese yen and managed to record a gain," a chief dealer with a
local private bank said.
The Japanese currency fell to the 117 level against the U.S.
dollar in afternoon Asian trading.
The rupiah opened at 7,900/8,200 against the dollar and rose
to an intraday high of 7,650 before easing in late trading to
close at 7,700.
Its Tuesday close was 1.3 percent firmer than Monday's close
at 7,800.
Dealers said that the signing of the government's latest
letter of intent with the International Monetary Fund (IMF) had
also contributed to rupiah's strong footing.
"Sentiment regarding the rupiah remains positive in the short
term, but its medium-term outlook remains blurred," the dealer
said.
He said the resistant level for the rupiah would be 7,000. As
soon as the currency hits that level some offshore operators
would probably start buying dollars.
"I guess some offshore operators are now watching closely for
when the rupiah hits that level," the dealer said.
Like the rupiah, share prices in the local market rose
marginally on Tuesday, supported by late buying of certain
selective stocks in a positive response to the strong rupiah.
"Late buying in telecommunications and cigarette stocks
enabled the main index to rise. Otherwise, the index would have
gone down," an institutional sales broker with Trimegah
Securindolestari said.
The Jakarta Stock Exchange (JSX) Composite Index rose 0.15
points to 336.57 on a total turnover of 241.62 million shares
changing hands valued at Rp 280.81 billion (US$36.5 million).
Johanes Salim, an analyst with Mashill Jaya Securities, said
stocks of local corporation with huge foreign exchange debts were
the main buying targets by foreign investors in the afternoon.
"With a strong rupiah, the corporations will likely have some
room to service their mounting overseas debts," he said. He cited
cigarettemakers PT HM Sampoerna and its rival PT Gudang Garam as
some of the targeted stocks.
HM Sampoerna rose Rp 150 to Rp 3,800 on 6.93 million shares
while its rival Gudang Garam rose Rp 50 to Rp 8,400 on 2.52
million shares.
However, stocks in export-oriented companies became foreign
investors' selling targets following the rupiah's rise, he said.
"With a persistent appreciation of the rupiah, the gross
margin of those export-oriented firms will likely decline," he
said.
He singled out fishing firm PT Daya Guna Samudera and gold
mining firm PT Aneka Tambang as examples.
The stock price of Aneka Tambang fell Rp 25 to Rp 1,450 on
9.66 million shares traded, and Daya Guna slid Rp 275 to Rp 4,000
on 970,500 shares. (aly)