Stock market set for new 900 level: Analysts
Stock market set for new 900 level: Analysts
The Jakarta Post, Jakarta
The Jakarta Composite Index will likely increase to a new level
of over 900 points this week as the stock market continues to
gain further momentum from various positive sentiments, analysts
said.
"Such a level (900 points) is highly probable," Arwani
Pradjaja of Mandiri Securities said on Sunday. "Our prediction is
that the market could even reach 906 points over the week."
Analyst Lorensius Chrisbiantoro of BCI Securities was quoted
by AFP on Friday as saying that the index could break the 900
level with investors mostly focusing on second-liner stocks.
"There is still a chance for the index to continue rising due
to the euphoria in regional markets following President Bush's
victory and a drop in global oil prices," Lorensius said.
The index has risen from 863.59 points last Monday to 893.63
points last Friday, or less than 7 points below the
psychologically important 900-point level.
The highest gain occurred last Tuesday, when it jumped 17
points to 881.396, with the only exception to the trend last
Thursday, when it slipped slightly to 888.33 points from 890.36
points.
Friday's closing level for last week showed an increase of
3.85 percent from 860.48 points the previous week.
Last week's average daily volume at the Jakarta Stock Exchange
(JSX) reached 1.54 billion shares worth Rp 1.56 trillion (US$172
million), compared to 1.46 billion shares worth Rp 1.01 trillion
the previous week.
Besides the ongoing positive sentiment from companies' strong
third-quarter performance reports, Arwani said the other main
contributing factor was the stability of the rupiah exchange rate
against the dollar over the month.
"It has created a particularly suitable situation for the
stock market to grow," he said.
Arwani also said the government's plans to sell more of its
minority shares in several banks would also positively affect the
market sentiment over the week.
The government sold on Thursday 10 percent of its shares in
Bank Danamon for Rp 1.74 trillion, which helped boost last
Friday's trading to 1.4 million shares worth Rp 2.8 trillion.
Meanwhile, the finance ministry's Asset Management Company
(PPA) affirmed on Friday that it would sell 20 percent of
government shares in Permata Bank in mid-December.
Commenting on the U.S. presidential outcome, Arwani said it
would not further affect the market, which had already
anticipated who would win.
During a visit to the JSX last week, Minister of Finance Yusuf
Anwar said the market index would reach the 900 level. He was
even optimistic that it would only be a matter of time before the
bourse reached a 1,000-point level, as long as the government
kept working hard to create a suitable condition for investors.
Arwani was, however, careful in forecasting whether the
current momentum was enough to drive the market to the 1,000-
point level.
"Many have indeed begun talking about the 1,000 level, but we
cannot be too sure of that yet," he said.