The Indonesia stock market has closed lower now in back-to-back sessions, shedding more than 50 points or 1.2 percent along the way. The Jakarta Composite Index finished just above the 4,090-point plateau, and now traders are hoping for a mild recovery when the market kicks off trade on Thursday.
The global forecast for the Asian markets continues to be a week-long holding pattern, waiting for hints of further stimulus from Federal Reserve Chairman Ben Bernanke. The Fed chief is scheduled to speak at the Kansas City Federal Reserve's Jackson Hole symposium on Friday, and many traders expect him to address the possibility of further quantitative easing. Upbeat economic data from the U.S. gives the markets a slight upside bias. The European markets were mixed and the U.S. bourses were slightly higher, and the Asian markets are expected to split the difference.
The JCI finished sharply lower on Wednesday following losses from the resource stocks and the automobile producers.
For the day, the index plummeted 49.68 points or 1.20 percent to finish at 4,093.17 after trading between 4,072.85 and 4,138.33.
Among the decliners, Bumi Resources plunged 13.16 percent, while Adaro Energy dropped 2.86 percent, Borneo Lumbung Energi and Metal lost 3.7 percent, Astra International fell 2.10 percent, Bank Mandiri gave away 4.29 percent and Semen Gresik retreated 3.88 percent.
The lead from Wall Street is cautiously optimistic as stocks showed a lack of direction on Wednesday, extending the lackluster performance seen in the two previous sessions. The choppy trading came despite the release of a batch of relatively upbeat economic data.
Traders largely shrugged off some upbeat U.S. economic data, including a report from the Commerce Department showing stronger than estimated U.S. economic growth in the second quarter. GDP increased 1.7 percent in the second quarter compared to the 1.5 percent growth previously reported - in line with estimates.
Also, the National Association of Realtors showed that pending home sales rose by more than expected in July, reaching their highest level in over two years. NAR said its pending home sales index rose by 2.4 percent to 101.7 in July after falling by 1.4 percent to 99.3 in June. Economists had been expecting the index to increase by about 1.0 percent.
Additionally, the Federal Reserve released its Beige Book, indicating that U.S. economic activity continued to expand gradually in July and early August. The Fed's Beige Book is a compilation of anecdotal evidence on economic conditions from each of the twelve Fed districts. Six districts indicated that the local economy continued to expand at a modest pace, while another three cited moderate growth.
The major U.S. averages were slightly higher on Wednesday as the Dow inched up 4.49 points or less than a tenth of a percent to finish at 13,107.48, while the NASDAQ rose 4.05 points or 0.1 percent to end at 3,081.19 and the S&P 500 edged up 1.19 points or 0.1 percent to close at 1,410.49.
by RTT Staff Writer
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