Rupiah, stocks down on regional weakness
JAKARTA (JP): The rupiah and local stock prices ended down yesterday over regional weaknesses and profit taking after a few days of successive gains on positive news about Indonesia's donors' meeting.
Currency dealers said the rupiah slipped to 13,100/200 against the U.S. dollar at the close of Jakarta trading, compared to Thursday's close of 13,000.
They said the weakening of the rupiah was especially driven by most operators' move to sell rupiah to square their position as they had gone long on the currency days before Indonesia's donors pledged at their meeting in Paris to loan Indonesia US$7.9 billion this fiscal year.
"Today (yesterday), most players were selling rupiah to square their position ahead of the weekend after keeping their long rupiah position for quite some time," a dealer with a state bank said.
Dealers said the rupiah was also following the Japanese yen, which fell below 144 against the dollar yesterday.
They said the market did not bow down to bullish words from Coordinating Minister for Economy, Finance and Industry Ginandjar Kartasasmita that the government would use some of its foreign loans to buy rupiah to bring it up to 10,000.
Intervention
The state bank dealer warned that the government should not conduct futile intervention, like what it did a few weeks ago, especially in considering the current political uncertainties and widespread social and security concerns.
"If it does intervene now, it would be the speculators who would benefit," he said.
He said the market was anticipating more social unrest ahead of the anniversary of Indonesia's independence later this month.
Stock prices on the Jakarta Stock Exchange (JSX) lost ground, with the JSX Composite Index inching down 0.971 points to close at 481.71.
Trading turnover totaled 216.99 million shares changing hands on the regular market valued at Rp 251.23 billion (US$19.1 million).
Losers outnumbered gainers by 54 to 33 with 112 stocks remaining unchanged and 79 others untraded.
Stockbrokers and analysts attributed the slight fall to regional weakness and profit taking by investors on certain stocks which had made big gains prior to the conclusion of the Consultative group on Indonesia (CGI) meeting in Paris.
"Though the aid commitment by the CGI was positive, the Japanese yen's fall and profit taking by some investors discounted it," the head of research at Trimegah Securities, David Chang, said.
Stock brokers said the bullish sentiment at the opening of trading on the local exchange, the first after the CGI pledged $7.9 billion in loan commitments to Indonesia, did not last long as some investors started to take profits to benefit from the gains they made prior to the CGI meeting.
"Profit taking coupled to the weaker rupiah following the drop of the Japanese yen ate up the gains made in the morning session," a broker with Mashill Jaya Securities said.
Trading on the local exchange was marked by a small rally at the JSX building yesterday by dozens of supporters of dismissed PLN president Djiteng Marsudi, They demanded State Minister of the Empowerment of State Enterprises Tanri Abeng review the privatization program.
"We want Minister Tanri Abeng to review the privatization program," one of the protesters shouted.
But dealers said investors were not really affected by the rally.
"Demonstrations like this have become a political game rather than a business game," a dealer with a local securities house said.
Tin producer PT Tambang Timah fell Rp 100 to Rp 8,700 on 765,000 shares traded and cigarette maker PT Gudang Garam shed Rp 50 to Rp 8,900 on 516,500 shares traded. (aly/rid)