Shares fall again, rupiah weakens

JAKARTA (JP): Heavy selling continued on the Jakarta Stock Exchange yesterday with the Composite Index losing another 3.5 points to close at 666.84

Securities analysts attributed the loss on an overnight drop on Wall Street and fears of a possible rise in the U.S. interest rates.

In the currency market, the rupiah lost ground against the dollar in solid trade.

Spot rupiah prices were between 2,401.60/02.00 in afternoon trade after opening at 2,399.50/400.50.

"Liquidity in the banking system remained high with overnight call money hovering low at between five to six percent," one foreign bank dealer said.

The Indonesian rupiah fluctuated against the dollar in thin trading on Friday as operators were cautious in the wake of the central bank's surprising recent moves, dealers said.

The recent moves included the central bank's decision to cut its key discount rates for short-term securities (SBPUs) by 50 basis points on Wednesday.

The central bank also increased its fixing rates by two points on Wednesday and lowered them by one point on Thursday.

Stock trading analysts said concerns that Bank Indonesia's credit restrictions would affect banks' earning projections affected the stock market

"It is just like yesterday, many investors sold their banking shares," a dealer said.

The country's largest bank, Bank Negara Indonesia, lost Rp 75, Bank International Indonesia fell 75 rupiah, Lippo Bank dropped Rp 100, Bank Papan lost Rp 350 and Bank PDFCI Rp 100.

Several nonbank blue chips gained ground saving the share market from a steeper fall.

Car maker Astra International's shares rose Rp 50, cigarette, maker Gudang Garam gained Rp 25 and Indofood rose Rp 175. (hen)