Jakarta share prices closed 0.8 percent lower on Monday, with the selloff partly driven by fears that the anti-monopoly watchdog may rule against Temasek Holdings, dealers said. The anti-monopoly regulator, known as KPPU, was holding a session to read its final decision on allegations that Temasek violated competition laws.
The KPPU has alleged that Temasek's cross ownership of Indonesia's two largest cellular carriers - Telkomsel and Indosat - has reduced the degree of competition in the local cellular market. The Jakarta Stock Exchange composite index closed down 21.89 points at 2,646.81 on volume of 3.16 billion shares worth 3.74 trillion rupiah (400.6 million dollars).
The Indonesian rupiah was trading at 9,330/9,335, compared to 9,320/9,325 on Friday. "People believe that Temasek will lose that case. I think that's why people are selling stocks," said Endang Purnama, a dealer with Panin Securities.
"I think foreign investors are liquidating their positions. I am afraid it has something to do with the ruling on Temasek," said Ferry Khusaeri, an analyst with Indo Premier Securities.
But the extended selloffs should, at some point, provide buying opportunities, he said. Indosat lost 400 rupiah to 8,400 while Telkom, which owns a 65 percent stake in Telkomsel, dropped 50 rupiah to 10,450. Among the key losers was coal giant Bumi Resources.
Bumi came under selling pressure as investors reduced their position in the stock in anticipation of the upcoming initial public offering of Indo Tambangraya, a unit of Thailand's largest coal miner, Banpu PCL, next month. Bumi Resources fell 300 to 4,300 and rival Bukit Asam dropped 500 to 10,150. Bucking the trend, Bank Central Asia gained 150 to 7,100 and Bank Rakyat Indonesia added 100 to 7,850.