Stock investors to cash in gains, rupiah to strengthen
Stock investors to cash in gains, rupiah to strengthen
M. Taufiqurrahman
The Jakarta Post
Jakarta
Profit-taking is expected to dominate transactions on the Jakarta
Stock Exchange this week as investors try to cash in on recent
gains, an analyst has said.
But overall sentiment would remain positive on the back of
good financial results published by listed companies, said
analyst Prasti Rindrawati on Sunday.
"I think there will be a slight rise in the (Jakarta
composite) index," she told The Jakarta Post.
After three days of trading, the Jakarta Stock Exchange
composite index closed on Wednesday at 467.939, down 1.695
points, or 0.36 percent, from the end of the previous week. The
market was closed on Thursday and Friday for a public holiday.
Prasti said strong annual earning reports announced by some
listed companies had heartened investors.
"This is creating a positive sentiment in the market," she
said.
Blue-chip companies such as telecommunications company PT
Telkom, media and broadcasting leader PT Bimantara Citra, mining
company PT Aneka Tambang and retail giant PT Matahari Putra Prima
have recently made public their annual financial performance.
The analyst said that the country's positive macroeconomic
outlook had also given market players every reason to be
optimistic.
"The impending military conflict in Aceh is something
investors will watch closely in the most immediate future, but I
think the (stock) market has begun to be less susceptible to
political factors," she said.
Turning to the currency market, currency analyst Farial Anwar
said there was a strong indication that the rupiah would
strengthen on the expectation of more capital inflows as
investors purchased local assets.
"I am sure that Bank Indonesia (BI) will soon give a green
light to the Bank Danamon takeover, and regardless of whether the
payment is to be made in dollars or rupiah, there will definitely
be an increase in the supply of dollars in the next week or two,"
Farial said, referring to the recent sale of Bank Danamon to a
consortium jointly owned by Deustche Bank and Singapore-based
Temasek holding company.
He told the Post that unless there were confounding statements
from government officials the chance of the rupiah strengthening
against the greenback was greater.
"The newly elected governor of Bank Indonesia is a
noncontroversial figure and he has made the right step by giving
market-friendly statements about the local currency," he said,
referring to last week's election of Burhanuddin Abdullah as the
new leader of the central bank.
The rupiah would also benefit from the weakening of the U.S.
dollar, which has been on a steady decline in the past two years,
he said.
"There is nothing to indicate that the U.S. economy will
improve soon," he said.
He said the market would be more concerned with domestic
issues. If the conflict in Aceh were resolved swiftly, there
would be no significant threat to the stability of the rupiah.
"If all goes well, I guess the rupiah will be trading this
week at about Rp 8,425 to Rp 8,500 to the dollar," he said.
The rupiah strengthened last week to Rp 8,425 to the dollar,
compared with Rp 8,555 the week before.