Jakarta. The benchmark stock index of Indonesia — like those of its Southeast Asian peers — declined significantly on Monday, on concerns that the Greek debt crisis could spill over into the region.
The Jakarta Composite Index declined 1.33 percent to close at 4,916.74 on Monday, with the sharpest decline led by finance-related stocks. In the year-to-date, the JCI has fallen by 5.93 percent, with analysts attributing this decline to various reasons, including weaker economic growth, the weaker rupiah and lackluster corporate earnings.
Around 5.18 billion shares worth Rp 4.4 trillion ($329.3 million) were traded on Monday. Decliners beat gainers 228 by 61, with foreign investors dumping Rp 174.5 billion in shares more than they bought.
The rupiah weakened to 13,353 per dollar from 13,316, according to data from Bank Indonesia.
“The global stock markets were affected by negative sentiments from the outcome of Greece’s referendum,” said Alfiansyah, head of research at Valbury Asia Securities, as quoted by the Antara news agency.
Greeks overwhelmingly voted “No” in a historic bailout referendum on Sunday, partial results showed, defying warnings from across Europe that rejecting new austerity terms for fresh financial aid would set their country on a path out of the euro.
“Market players were being overshadowed by worries over the Greek debt crisis, they tended to make selling moves,” Alfiansyah said, as quoted by the state-run news agency.
An index that traces 85 finance-related stocks at the Indonesian Stock Exchange (IDX) declined 1.81 percent, leading the sectoral fall. It was followed by an index that tracks 36 consumer goods industry, which fell 1.78 percent during the day.
The top laggard stock on Monday was that of state lender Bank Rakyat Indonesia, followed by those of consumer goods giant Unilever Indonesia.
BRI’s stocks, traded under the code of BBRI, declined 3.93 percent to close at Rp 10,400 per share. BBRI is a heavyweight stock with market capitalization recorded at Rp 254 trillion.
Unilever stocks, traded under the code of UNVR, declined 2.11 percent to close at Rp 40,500 per share. Its market capitalization at the end of the day was Rp 309 trillion.
Elsewhere in Southeast Asia, shares also declined.
In Kuala Lumpur, the key index dropped 1.2 percent, to its lowest since June 30, as the ringgit hit a 16-year low after reports linked the country’s prime minister to an alleged corruption case.
Singapore’s benchmark Straits Times Index retreated from a closing high on Friday. The benchmark index in Singapore declined 0.67 percent.
Indexes in Thailand and the Philippines extended losses from Friday. Vietnam bucked the trend, rising for a third straight day.
However, the Greek impact is not expected to last very long as, fundamentally, Asian economies are not materially exposed to Greece, analysts from Maybank Kim Eng wrote in a report.
“Regional currencies and equity markets can be expected to be volatile with weakness bias in the short-term, pending clarity on the Greece crisis’ end-game, mainly due to ‘safe haven’ flows into major currencies and asset denominated in such currencies,” they said.
GlobeAsia, with additional reporting from Reuters
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