Share prices plunge on political fears
JAKARTA (JP): Share prices on the Jakarta Stock Exchange plunged 2.5 percent yesterday as President Soeharto issued a strong warning to campus protesters.
Brokers said that most investors sold their stocks because of fears that the President's warning would fuel more campus demonstrations, which have been taking place at all of Indonesia's major universities since before the House of Representatives elected Soeharto to a seventh consecutive five- year term in office in March.
"The President's order to the military to curb any attempt to undermine national stability suggests that the Armed Forces might use force to suppress the demonstrations. It could worsen political tension," one analyst said.
The Jakarta Stock Exchange Composite Index lost 2.5 percent, closing at 448.52 in a moderate trading yesterday, down from 460.13 on Thursday.
Trading volume dropped to 310 million shares valued at Rp 359 billion from 431 million shares valued at Rp 595 billion on Thursday.
Rupiah remained weak, closing at 8,000 rupiah per U.S. dollar in the spot market, almost unchanged from the previous day's.
The rupiah rose to 7,975 in early trading but weakened in the afternoon on fears of worsening political tension.
Many other Asian markets were closed for the May Day holiday.
In Hong Kong, shares prices rose sharply both in Hong Kong and Australia in reaction to overnight gains on Wall Street, AP reported.
The Hang Seng Index, the Hong Kong market's key indicator of blue chips, rose 180.00 points, or 1.7 percent, closing at 10,563.68. On Thursday, the index had lost 87.47 points.
Brokers said the Hong Kong market was boosted by overnight gains on Wall Street, where the Dow Jones industrial average rose 111.85 points to close at 9,063.37.
In Australia the All Ordinaries Index rose 42.1 points, or 1.5 percent, to 2,804.2.
In Tokyo, Japanese stock prices slipped in subdued trading ahead of a four-day holiday weekend in Japan.
The benchmark Nikkei Stock Average of 225 selected issues shed 40.16 points, or 0.26 percent, closing the week at 15,601.10 points. On Thursday, the index rose 245.83 points, or 1.60 percent.
In New Zealand, share prices closed slightly lower, drifting downwards after a strong start to the session on the back of good finishes in the U.S. and Britain's share markets.
The NZSE-40 Capital Index fell 3.25 points, or 0.1 percent, to 2,253.29.
The markets were closed for May Day celebrations in the Philippines, Taiwan, South Korea, Singapore, Malaysia and Thailand. (hen)