Indonesian shares fell 2.94 percent to 4,665.24 by midday, tracking a fall in regional stocks, after the U.S. Federal Reserve Chairman Ben Bernanke said the central bank would start to reduce its stimulus measures later this year.
Asian shares tumbled to nine-month lows on Thursday as slowing Chinese manufacturing activity exacerbated sentiment already unnerved after Bernanke said the Fed may reduce its bond-buying program with the goal of ending it in mid-2014.
Finance Minister Chatib Basri told reporters on Thursday that there will be pressure in emerging markets and that the Indonesian government and central bank will work together to deal with the impact of the quantitative easing tapering by the U.S. government.
Banking stocks fell more than 4 percent while property shares slid 3.5 percent. State-controlled lender Bank Mandiri and Bank Rakyat Indonesia dropped more than 5 percent each. Real estate developers Lippo Karawaci fell 6.4 percent while Bumi Serpong Damai slid 4.3 percent.
Jakarta’s blue chip index slid 3.46 percent.
$1 = 9,907.5 rupiah Reporting by Andjarsari Paramaditha and Adriana Nina Kusuma; Editing by Supriya Kurane