Rupiah hits 8,000, stocks rise 2.8%

Rupiah hits 8,000, stocks rise 2.8%

JAKARTA (JP): The rupiah slipped to hit an intraday low at
8,000 against the U.S. dollar on Wednesday in thin dealing as
stock prices closed 2.8 percent firmer, currency dealers and
stockbrokers said.

Currency dealers attributed the rupiah's fall to fresh dollar
demand from local commercial banks. The market shrugged off good
news about a new disbursement of international loans for
Indonesia.

The rupiah opened Jakarta trading at 7,800/7,900 and fell to
8,000 in morning trade before settling at 7,725 at the close. It
was still 1.6 percent lower than at its close on Tuesday at
7,600.

A chief dealer with a local private bank said state banks
unloaded a small amount of dollars, which apparently halted the
rupiah's slide.

"But I believe the rupiah will be lifted again following the
disbursement of the IMF loans," he said.

The International Monetary Fund approved on Tuesday the
release of another US$957 million loan to Indonesia under the $49
billion rescue package the Fund assembled for the country.

Nevertheless, dealers said heightening political tensions
would continue to cast a shadow on the rupiah's standing in the
future.

Unlike the rupiah, share prices on the Jakarta Stock Exchange
(JSX) rose significantly by 2.8 percent on Wednesday, driven by
bullish sentiment in the regional market following the overnight
rise on Wall Street.

The JSX Composite Index closed 11.49 points firmer at 412.69
on a total turnover of 225.07 million shares changing hands at Rp
303.45 billion.

However, losses led gains by 53 to 51 with 86 stocks
unchanged.

An institutional sales broker at Trimegah Securindolestari,
Vonny Juwono, said bullish regional sentiment was behind the rise
in the local index.

"It was this bullish sentiment in other regional markets which
helped the local stocks to strengthen," Vonny said.

Head of research of BNI Securities Adrain Rusmana said that
the increase in share prices did not necessarily reflect the
return of foreign investors into the battered local bourse.

"It is out of the question as foreign investors are still
scared to invest in the market for political reasons," he
said.

Trading in the local market was marked by a 30 minute delay
for each session due to software problems. (aly)