Telkom fails to boost market

Telkom fails to boost market

JAKARTA (JP): Listing of the state-owned telecommunications
firm PT Telkom failed yesterday to boost weak sentiment on the
Jakarta Stock Exchange (JSX) as local speculators reaped quick
profits.

Telkom was closed yesterday at its initial offering price of
Rp 2,050 ($0.76), down Rp 50 from Rp 2,100 at the opening of a
special trading session on Tuesday night.

The volume of Telkom trading yesterday reached 38.9 million,
with PT Makindo and PT Bahana Securities, two of Telkom's
domestic lead underwriters, executing the largest transactions,
brokers said.

At the same time, the JSX Composite Index hit another low of
460.81 points, falling by nine points, or 1.81 percent, from the
day before.

"Telkom failure to boost weak sentiment was due partly to
selling pressure from local speculators trying to make quick
profits," an analyst from BDNI securities said.

Telkom's listing, the largest listing on local markets, and
Asia's largest listing this year, has been expected to help
strengthen investors' trust in the markets.

Securities analysts said Telkom was not the one to blame when
it failed to drive up the markets, especially when the global
market condition was so bad these days. In addition,
telecommunication stocks have been weak in the global market the
last few weeks.

They said investors' sentiment to sell Telkom, to reap quick
premiums, partly caused the price fall.

Reuters reported yesterday that in its initial public offering
on the New York Stock Exchange, Telkom was among the most active
on the exchange, with 4.4 million shares traded. The stock gained
five eighths of a point to the primary price of US$18 per
American Depository Share, which constitutes 20 ordinary shares.

Director of Merrill Lynch in New York, Edward Higgins, said
that the small margin of price movement proved that the price had
been settled for the benefit of the investors, Antara reported
yesterday. (10/rid)