Stocks fall almost 4 percent, rupiah stable in thin trade

Stocks fall almost 4 percent, rupiah stable in thin trade

JAKARTA (JP): Stock prices on the Jakarta Stock Exchange (JSX)
fell almost 4 percent on Friday due to massive selling pressure
on some blue chip stocks.

But the rupiah remained stable against the U.S. dollar,
closing at 10,750 after falling to an intraday low of 11,050 as
some investors squared their positions ahead of the weekend,
currency dealers said.

Stockbrokers said that bearishness in the regional market as
the result of fears of a global economic recession had extended
to the local market, prompting foreign investors to dump most big
capitalized stocks.

"The fall of other regional markets in the absence of any
fresh leads at home has forced most investors to dump most blue
chip stocks," an institutional broker with Trimegah
Securindolestari said.

She said the fall in most European stock markets and the 2.7
percent drop in the Dow Jones Industrial Average on Thursday had
enervated foreign investor sentiment.

Associate director of Bahana Securities Andre Cita said the
fear of a global recession had cast a shadow on trading
activities on Friday despite small gains in some stocks with
strong fundamentals.

"Sentiment is so bad that there is no reason for foreign
investors to stay here," he said.

Trimegah's broker said that most foreign brokerage firms,
which usually account for large trading transactions in the local
market, were making more selling orders than buying orders.

Jardine Fleming, Credit Lyonnais, HSBC Securities and ING
Barings Securities were net sellers on Friday.

The JSX Composite Price Index fell 3.88 percent or 10.64
points to 263.22 on a total turnover of 263.22 million shares
changing hands in the local market valued at Rp 129. 53 billion
(US$12.04 million).

Losers led gainers 54 to 21 with 77 stocks remaining
unchanged.

Brokers said foreign investors discarded stocks of state
telecommunications firms and mining stocks after experiencing a
sharp rise in the last two days.

State telecommunications firm PT Telkom, which accounts for
about 17 percent of market capitalization in the local bourse,
fell Rp 150 to Rp 1,325 on 10,62 million shares changing hands,
while international call operator PT Indosat was down Rp 100 to
Rp 5,550 on 582,500 shares changing hands.

Mining firm PT Tambang Tim slid Rp 475 to Rp 4,050 on 580,000
shares traded, while Tjiwi Kimia fell Rp 50 to Rp 925 on 5.30
million shares.

Unlike local stocks, the rupiah managed to close relatively
stable at 10,750 against the American dollar on Friday.

"Some investors sold their dollars to square their positions
ahead of the weekend," a dealer with a local private bank said.

Dealers said trading activities remained thin as most
investors did not want to build any new positions on the rupiah
for fear that political uncertainty at home could curtail
investor sentiment here. (aly)