The Indonesia stock market has moved higher now in two straight sessions, collecting more than 60 points or 1.5 percent along the way. The Jakarta Composite Index finished just below the 4,050-point plateau, although now traders may be tempted to lock in gains when the market kicks off trade on Tuesday.
The global forecast for the Asian markets is flat with a touch of weakness following disappointing news from the IMF, plus soft economic data from the United States. The International Monetary Fund on Monday slashed its 2013 growth forecast for the global economy, while the Commerce Department reported an unexpected drop in retail sales. The European markets were mixed but little changed and the U.S. bourses were slightly lower, and the Asian markets figure to split the difference.
The JCI finished modestly higher on Monday following gains from the resource stocks and energy producers.
For the day, the index collected 27.80 points or 0.69 percent to finish at 4,047.47 after trading between 4,035.84 and 4,064.41.
Among the gainers, Medco Energi Internasional added 1.2 percent, while Intiland Development spiked 4.3 percent and Timah jumped 2.1 percent.
The lead from Wall Street is slightly negative as stocks saw moderate weakness on Monday, giving back some ground after ending last Friday's trading sharply higher. The pullback came on the heels of the release of a disappointing report on U.S. retail sales.
Much of the weakness followed a report from the Commerce Department showing that retail sales fell by 0.5 percent in June following a 0.2 percent decrease in May. Economists had expected sales to edge up 0.2 percent. With the decrease, retail sales fell for the third straight month. Excluding a drop in sales by motor vehicle and parts dealers, retail sales still fell by 0.4 percent in June, matching the decrease in the previous month.
Selling pressure was subdued after a separate report from the New York Federal Reserve showed stronger than expected growth in regional manufacturing activity. The New York Fed said its general business conditions index rose to 7.4 in July from 2.3 in June, with a positive reading indicating growth in the manufacturing sector. Economists had expected a more modest increase to a reading of 4.5.
A positive reaction to quarterly results from Citigroup (C) also helped to limit the downside for the markets, with the financial giant advancing 0.6 percent. Citigroup reported Q2 earnings that fell year-over-year but still beat estimates - although revenue fell by slightly more than expected.
The major averages ended the day in negative territory but well off their lows for the session. The Dow fell 49.88 points or 0.4 percent to finish at 12,727.21, while the NASDAQ slid 11.53 points or 0.4 percent to end at 2,896.94 and the S&P 500 edged down 3.14 points or 0.2 percent to 1,353.64.
by RTT Staff Writer
For comments and feedback: editorial@rttnews.com
Market Analysis