Trading on JSX to slow down this week as year-eand nears
Trading on JSX to slow down this week as year-eand nears
JAKARTA (JP): Trading activities on the Jakarta Stock Exchange
(JSX) this week will start slowing down as the year-end
approaches, according to stock analysts.
They said demand on the JSX would be low as many fund managers
would only take a sale position to wrap up for the year and
calculate their annual performance.
"They are selling their holdings for a gain as well as for a
cut loss, to calculate their performance for the whole year,"
said Dodi Prawira of Bapindo Bumi Sekuritas.
Dodi said the supply side would be affected as most fund
managers were generally net sellers.
The JSX Composite index would close a little lower this week
due to weak demand.
"It is a normal situation when it is approaching the end of
the year," he said.
Dodi said, to some extent, the above weak demand would be
offset by share price window dressing by small capitalized listed
companies, which would likely start this week.
The management of the companies would like to push their
company's shares up to make their performance look better and be
recorded at the year-end , he said.
"They probably would like to see their price move up by three
or four points by the end of the year," he said.
This window dressing would only be with shares of small caps,
as it is possible to prop up these shares, according to Dodi.
The country's fundamentals -- indicated by recovering
purchasing power, price stability and a lower inflation rate --
had appeased the market but with certain apparent limitations,
Dodi added.
"The decreasing inflation rate is a good macroeconomic
indication, but we have a lot of unsettled banking problems," he
said.
Banking problems would certainly put some weight on trading
this week, Dodi said.
He said the Bank Bali scandal was not resolved, and yet
another huge banking scandal, involving state Bank Negara
Indonesia (BNI), was following it.
The Bank Bali scandal centers around a Rp 546 billion transfer
of commission money from the bank to a broker company owned by
politically well-connected businessmen.
The BNI scandal involves a local textile and heavy machinery
conglomerate, Texmaco Group, which allegedly received loans
amounting to Rp 9.6 trillion (US$1.35 billion) from the state
bank through incorrect procedures.
The latter scandal has come to the attention of investors who
were already concerned with the Bank Bali scandal.
The country's bank restructuring program, being obstructed a
few times by scandals, had yet to show concrete signs of positive
impact, said Dodi.
"Those banks being recapitalized have to prove they can
maintain their CAR (Capital Adequacy Ratio) above the required
four percent level, so they can start lending as usual," he said.
CAR, a standard to measure a bank's financial soundness, is
the ratio between the bank's equity and its risk-weighted assets.
The market would like to see the banking sector restart their
lending normally again to the country's credit-thirsty industrial
sector.
Other stock analysts said Aceh would still weigh on the JSX
Composite index, as the government was judged by the market as
too slow and too poor in handling the problem.
" The Aceh issue will continue to be an unsupportive factor
for the market this week," an analyst said.
He said the market would now pay close attention to what
follows the celebration of the anniversary of the Free Aceh
Movement (GAM) over last weekend.
"We hope there will not be any civil unrest following GAM's
anniversary," he said.
The JSX Composite Index increased by 2.8 percent to 613.48
points last week, from 596.35 points the previous week.
The average daily turnover last week decreased to 471.6
million shares, compared to 639.6 million the previous week.
But the average daily transaction value increased to Rp 522
billion last week from Rp 461.8 billion the week before.
Last week's top gainers were PT Putra Surya Perkasa, rising
100 percent, PT Sucaco (up 35 percent) and PT Zebra Nusantara,
(up 33.33 percent).
The week's losers were PT Samudera Indonesia (down 33.33
percent), PT Primarindo Asia Infrastructure (down 23.68 percent)
and PT Cipendawa Farm Enterprise (down 23.08 percent).
Meanwhile, the JSX last week de-listed plastic packaging
company PT Aster Dharma Industri, belonging to Dharmala Group,
due to its continuous deteriorating financial performance.
The exchange, on the other hand, included Bank Danpac as a
listed company that started its first trading last week.
The top brokerage firms by transaction value were PT Credit
Lyonnais with Rp 412 billion, PT Danareksa Sekuritas (Rp 337.5
billion) and PT Bahana Securities (Rp 233.5 billion).
The rupiah decreased by a half percent to close at Rp 7,242 to
the U.S. dollar last week, compared to its close at Rp 7,205 the
previous week. (udi)