I

ndonesian stock prices suffered the steepest drop in more than two months on Monday as investors took profits amid regional selling pressures that analysts consider reasonable and temporary.

The benchmark Jakarta Composite Index (JCI) of the Indonesia Stock Exchange (IDX) fell 1.8 percent to close at 3,915, after losing 2.3 percent in early trading. The index was among the worst performers in the regional stock markets on the day where most major Asian stocks were also in the red.

The price fall occurred across the board as both local and foreign investors took profit. According to the JSX data, foreign investors, who hold 60 percent of Indonesia’s publicly traded stocks, sold Rp 2.07 trillion of stocks, while at the same time buying Rp 1.31 trillion, leaving a net sell of Rp 757 billion.

The Rupiah also weakened 0.2 percent to Rp 9,005 per US dollar as of 3:25 p.m. Jakarta time on Monday, paring this year’s gain to 0.7 percent, according to Bloomberg.

“Investors took the selling position because on one side, the JCI is in the overbought zone, but on the other side, global conditions support selling positions. So both factors pressure the JCI downward,” said Reza Priambada, an analyst at PT Indosurya Asset Management, which manages Rp 80 billion.

The benchmark stock index reached 4,001 on Jan. 19, gaining almost 5 percent in three weeks since the start of 2012 and more than 22 percent since Oct. 5.

“The regional market also felt pressure as global news has recently been negative,” Reza said, citing the ratings downgrade of Italy and Spain, as well as the lower-than-expected United States economic growth.

The stock index of India slumped 2.29 percent, while that of Hong Kong, China and South Korea respectively tumbled more than 1 percent. Thailand, Malaysia, Singapore and Australia managed to post less than a 1 percent loss.

“Ever since breaking the 4,000 barrier, we have become more prone to profit taking than the others because investors have captured fairly large gains here,” said PT Mandiri Sekuritas technical analyst Rafdi Prima.

Analysts said selling pressures would not worsen in the near future because the market will bounce back, or even rally in March, when major listed companies were expected to announce their solid 2011 financial reports

“Today is the pull back, but this is just temporary.” He said that today’s steep fall would not affect Mandiri Sekuritas’ estimated 20.39 percent increase in the JCI this year.

The big cap stock prices dropped on Monday following a hit on the JCI, with consumer goods giant PT Unilever Indonesia Tbk. (UNVR) diving 4.39 percent to Rp 19,600. Top automotive distributor PT Astra International Tbk. (ASII) and the nation’s largest bank PT Bank Mandiri Tbk (BMRI) were down 2.9 percent to Rp 77,100 and Rp 6,650 respectively.

The nation’s third largest telephone operator, PT XL Axiata Tbk (EXCL), controlled by Malaysia’s Axiata Group, saw its shares dropping the most in three months as they sank 5.8 percent to Rp 4,500 a share. Shares of state-run cement maker PT Semen Gresik Tbk (SMGR) were down by almost 4 percent to Rp 10,850 apiece.

Overall, losers beat gainers 210 to 41 during the day when trading value was moderate at Rp 4.11 trillion with 3.86 billion shares changing hands, stock exchange data shows.

The trade index was the only one booking slight gains of 0.04 percent on Monday while the other nine were in the red, as basic industry, miscellaneous industry, consumer goods, infrastructure and manufacture indexes respectively lost more than 2 percent.

The yield on the 7 percent note maturing in May 2022 fell three basis points, or 0.03 percentage point, to 5.46 percent, according to prices from ANZ Banking Group in Jakarta. The rate has declined 56 basis points this month through to Jan. 28, according to Inter-Dealer Market Association.