Worries over RI standoff tug down bourses
Worries over RI standoff tug down bourses
SINGAPORE (AFP): Worries over a damaging standoff between
Indonesia and the International Monetary Fund (IMF) over a pegged
exchange-rate sparked a sell-off on Asia-Pacific stock markets
yesterday.
An IMF warning to Jakarta to give up its plan to institute a
currency board regime pegging the ailing rupiah to a fixed rate
against the dollar shook already fragile stock market sentiment
region-wide.
Singapore was the worst-hit, closing 4.6 percent lower.
Stock indices plunged 3.5 percent in Manila, 3.4 percent in
Kuala Lumpur, 3.2 percent in Bangkok, 1.5 percent in Hong Kong
and Seoul, and 1.2 percent in Sydney. Taipei was barely higher,
and Tokyo was marginally lower.
But shares rose 2.1 percent in Jakarta as investors picked up
safe-haven stocks.
Investors in Singapore were hit by jitters over the
deteriorating situation in Indonesia, where the city-state has a
massive investment and loan stake, dealers said.
"It's Indonesia. One word answers all," Eddie Lee, regional
economist with investment house Vickers Ballas, told AFP. "This
is the thing that dominates the Singapore market, given the fact
that the situation there is so uncertain. "
The Straits Times Industrials index ended 71.14 points lower
at 1,481.55, making the Singapore bourse one of the worst-hit
stock markets in the region for the day. The more broadly-based
All-Singapore index closed 16.69 points lower at 391.36.
Singaporean companies, including government-linked
corporations, have billions of dollars invested in Indonesia.
In Tokyo, Japanese share prices ended slightly lower, with
most of their early losses on profit taking recouped by late
bargain hunting, brokers said.
The key Nikkei stock average on the Tokyo Stock Exchange shed
15.49 points or 0.1 percent to end the session at 16,775.52,
while the broader Topix index of all first section issues ended
down 7.11 points at 1,273.43.
In Hong Kong, shares dropped 1.5 percent on worries over
rising interbank rates amid the financial crisis in Indonesia,
dealers said.
"The market is worried over the currency situation in
Indonesia," said Eugene Law, research head at Lippo Securities.
The key Hang Seng index lost 150.57 points to close at a two
week-low of 10,124.03 points, following a 2.0-percent loss last
week, but paring down early losses which sent the Hang Seng below
the key 10,000-point level.
In Kuala Lumpur, Malaysia's key stock index fell 3.4 percent,
dragged down by worries over Indonesia's crisis and failed
merger talks between Bank of Commerce and RHB Bank.
The Kuala Lumpur Stock Exchange's 100-share weighted composite
index fell 23.56 points to finish at 661.94, off an earlier low
of 657.15. The second board index slipped 6.0 percent or 12.09
points to 187.89.
In Sydney, Australian share prices slumped 1.2 percent as
Asia's economic crisis and the related political crisis in
Indonesia shook investor confidence, brokers said.
The Australian Stock Exchange's key All Ordinaries index
closed 31.8 points lower at 2,621.2 points.
In Bangkok, Thai share prices closed 3.2 percent weaker as
investors held back amid worries about the direction of the
Indonesian economy, analysts said.
The Stock Exchange of Thailand (SET) composite index fell
15.91 points to close at 484.06, while the SET 50 selected index
fell 1.58 points to end at 36.51.
In Manila, Philippine share prices closed 3.5 percent lower on
selling sparked a regulatory ruling for the country's largest
power distributor to reduce tariffs and refund consumers.
The Philippine Stock Exchange composite index fell 72.25
points to 2,022. 73.
In Seoul, share prices closed 1.5 percent down in modest trade
on the Korea Stock Exchange on sluggish foreign buying and
institutional selling across the board, dealers said.
The composite index closed down 7.14 points at 476.98, off a
low of 469. 86.
In Taipei, Taiwan stocks closed barely higher as bargain
hunting of technology issues pared early losses amid strong
buying of property shares, dealers said.
The Taiwan Stock Exchange weighted price index edged up 1.83
points to 8, 708.29.
In Shanghai, the B share index lost 0.46 point to
close at 52. 60 points while the A share index of locally-trade
stocks fell 10.19 points, or 0.8 percent, to 1,305.43 points.
In Auckland, the New Zealand Stock Exchange closed down one
percent amid weak sentiment in Asian regional markets.
The NZSE-40 index was down 22.63 points to 2,290.39 on light
turnover of 51.9 million (30.5 million US dollars), with News
Corp half-owned Independent Newspapers Ltd down 20 cents to 8.05
dollars.