Rupiah, stocks recover from bomb incident
Rupiah, stocks recover from bomb incident
Dadan Wijaksana, The Jakarta Post/Jakarta
The Indonesian currency and stock markets staged a quick
recovery on Friday, as hopes are high that the deadly bombing a
day earlier will not undermine the economy or sabotage the
presidential election.
The rupiah closed higher at Rp 9,280 per dollar, up from 9,330
the previous day. The local unit breached the 9,400 level just
after a high-powered bomb went off near the Australian Embassy.
"But even yesterday (Thursday), panic selling after the blast
did not last long, the market sentiment slowly improved
afterward," said one currency dealer.
"The rupiah's performance today only confirmed that, supported
also by expectations that the presidential runoff will be
peaceful," he added, referring to Sept. 20 voting day when
President Megawati Soekarnoputri will compete head-on with the
only other candidate, Susilo Bambang Yudhoyono, for the 2004-2009
presidential term.
Aslim Tadjuddin, Bank Indonesia deputy governor, was also
upbeat about the post-bombing outlook, saying the rupiah had
stabilized.
The rupiah may face an even brighter outlook if the election
proceeds smoothly, he added. "The rupiah is expected to stabilize
further as the economic fundamentals remain good. The market can
now differentiate which disturbances are caused by fundamental
factors and which aren't."
The remarks echoed earlier optimistic statements by other top
economic officials.
Coordinating Minister for the Economy Dorodjatun Kuntjoro-
Jakti said that the terror attack would have only a small impact
on the economy, which is projected to grow by 4.8 percent this
year, as evident in previous bombings -- including the bombing of
two nightclubs on Bali, which killed 202 people in 2002.
On the stock market, the sentiment was good enough to drive
the Jakarta Stock Composite Index to a four-month high, led by
some blue chip shares hurt by the drop the day before.
The index closed 1.9 percent up at 797.78 points from the
previous closing, the highest level in four months. It dropped 4
percent after Thursday's blast, but regained ground to close 0.8
percent lower.
"Sentiment was virtually back to normal today. What's
important for the government is to maintain the momentum and keep
feeding the market with good signs, such as providing detailed
updates on the investigation, introducing measures to avoid
similar occurrences," said one stock dealer.
The nation's largest telecommunications firm Telkom, cigarette
maker giants Gudang Garam and HM Sampoerna all rose on a rebound
after falling the day earlier.
Telkom rose by 1.3 percent to Rp 8,050 after falling 2.5
percent the previous day, as Gudang Garam and Sampoerna gained
2.3 percent and 4.7 percent, respectively.
Gudang Garam closed at Rp 13,250, while Sampoerna at Rp 5,600.
Overall, 116 gainers outran 24 decliners with 54 shares
unchanged.
Indonesian markets will be closed for Monday's public holiday.