Indonesian stocks hits 3-year low

Indonesian shares closed down 6.3 percent Monday amidst fears that the rupiah will continue to slip amid lingering concerns over the global economic slowdown.

The Composite Stock Price Index (IHSG) dropped 78.455 points to a three-year low of 1,166.40 in thin trade. The last time the index reached this figure was in August 2005.

The LQ-45 index fell 16,709 points (7.12 percent) to 217,824 and the Jakarta Islamic Index (JII) plunged 13,876 point (7.15 percent) to 180,075.

Most blue chips dropped more than 9 percent, reflecting concerns about the state of the nation's economy and investor's eagerness to hold cash in preparation for the worst.

Top decliners included heavyweight state-owned telecommunications operator Telkom, which fell 9.3 percent to 5,350 rupiah, while Bank Mandiri dropped 9.5 percent to 1,340 and car distributor Astra slumped 10 percent to 8,100.

Market players kept on selling on worries of the declining IHSG, which some predicted may drop as low as the 1,000-level. To prevent this, the Indonesian Stock Exchange has implemented an auto-rejection mechanism which will halt trading that drop more than 10 percent.

Several shares, however, climbed up on Monday. Shares in Indosat rose 9.9 percent to 5,000 rupiah after the government confirmed Monday that Qatar Telecom can own up to a 65 percent stake in it.

The rupiah stumbled at 11,000 to the dollar against 10,200 previously. The rupiah closed at its lowest level since July 2001. (dre)