JAKARTA (TheInsiderStories) – Indonesia Stock Exchange (IDX) changed the auto rejection limitation starting today to curb the local stock market from coronavirus outbreak and oil price war. On Monday (02/09), the Jakarta Composite Index plunged 6.8 percent to 5,136.81 and the Rupiah lowered 1.16 percent to 14,385 against the US Dollar.
Based the official statement, the regulator stated, taking the policy to stabilize the shares trading and in order to ensure regular, fair and efficient Securities trading. The IDX regulated the selling offer price or buying demand for shares entered into Jakarta Automatic Trading System more than 35 percent above or 10 percent below for the reference price of stock with value of Rp50 up to Rp200.
Then, more than 25 percent above or 10 percent below the reference price for shares with a price range of more than Rp200 to Rp5,000 a share. And, more than 20 percent above or 10 percent below the reference price for shares with a price above Rp5,000 each.
The provisions are effective starting March 10, until the deadline to be determined later. Earlier, the IDX revoked all short selling transaction in the stock market followed the drowned of the JCI. It said, the short selling transactions ban will implemented until to the deadline to be determined later.
The official data showed, throughout the year the index has fell 13.44 percent. According to IDX, the decline in the last week of February was the biggest contributor to the decline in the in the global major exchanges and ASEAN.
While, Financial Services Authority (FSA) allowed listed companies to buyback shares up to 20 percent of their paid-up capital without need a shareholders approval. The new policy has been taken in an effort to ease market volatility and provide the stimulus to the market.
Since the beginning of 2020, Indonesian stock trading experienced significant pressure, which is indicated from the decline in the JCI by 18.46 percent until today. This happened inline with the slowdown and pressure of the global, regional, and national economy as a result of the COVID-19 outbreak and weakening world oil prices.
“For this reason, we issued a policy to conduct share repurchases by the issuers,” said the agency.
The highest decreases were experienced by the Philippines and followed by Indonesia, Vietnam, Singapore and Malaysia with weekly decreases of -7.9 percent, -7.3 percent, -5.45 percent, -5.34 percent and -3.17 percent.
It said, the investors’ anticipation of the impact of the coronavirus which is expected to expand to other countries has give an impact on the global economic and trade activities. Furthermore, IDX said has coordinated with Financial Service Agency and the government to formulate initiatives and incentives to be provided in order to anticipate the impact of the virus in the Indonesian capital market.
In the midst of negative sentiment surrounding the global financial markets, the agency urged the investors not to panic and continue to invest based on in-depth analysis.
On Friday, Bank Indonesia’ governor Perry Warjiyo, reported as of Feb. 27, total net foreign fund outflows amounted to Rp30.8 trillion (US$2.2 billion). Other sentiments that might affect the instruments were domestic data, such as manufacturing PMI which contracted 49.3 in January. In addition there is inflation data for Indonesia in February.
Written by Staff Editor, Email: firstname.lastname@example.org