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Indonesia Stock Market May Run Out Of Steam On Wednesday

The Indonesia stock market has moved higher in two straight sessions, collecting almost 30 points or 0.4 percent along the way. The Jakarta Composite Index now rests just shy of the 7,200-point plateau although the rally may stall on Wednesday.

The global forecast for the Asian markets is negative ahead of the FOMC's rate decision later today. The European and U.S. markets finished firmly in the red and the Asian bourses are expected to open in similar fashion.

The JCI finished barely higher on Tuesday as gains from the energy and cement companies were offset by weakness from the financials and resources.

For the day, the index perked 1.46 points or 0.02 percent to finish at 7,196.95 after trading between 7,186.25 and 7,252.19.

Among the actives, Bank CIMB Niaga shed 0.44 percent, while Bank Central Asia declined 1.16 percent, Bank Mandiri dipped 0.27 percent, Bank Rakyat Indonesia retreated 1.75 percent, Indosat Ooredoo Hutchison tumbled 2.09 percent, Indocement jumped 1.76 percent, Semen Indonesia rallied 2.86 percent, United Tractors lost 0.44 percent, Astra International gained 0.70 percent, Energi Mega Persada skyrocketed 9.45 percent, Astra Agro Lestari slid 0.28 percent, Vale Indonesia sank 0.77 percent, Timah fell 0.35 percent and Bumi Resources, Aneka Tambang, Bank Danamon Indonesia, Indofood Suskes and Bank Negara Indonesia were unchanged.

The lead from Wall Street is soft as the major averages opened in the red on Tuesday and held their negative bias throughout the session.

The Dow plunged 313.45 points or 1.01 percent to finish at 30,706.23, while the NASDAQ sank 109.97 points or 0.95 percent to end at 11,425.05 and the S&P 500 tumbled 43.96 points or 1.13 percent to close at 3,855.93.

The weakness on Wall Street came as traders were jittery ahead of the Federal Reserve's monetary policy decision later today. The Fed is widely expected to raise interest rates by another 75 basis points, although some see an outside chance for a 100-point rate hike.

Treasury yields saw further upside ahead of the Fed announcement, with the yield on the benchmark ten-year note jumping to a new 11-year high.

In economic news, the Commerce Department reported an unexpected spike in new residential construction in the U.S. in August, although the report also showed a steeper than expected slump in building permits.

Crude oil prices fell sharply on Tuesday amid concerns about interest rate hikes and worries about the outlook for energy demand. West Texas Intermediate Crude futures for October ended lower by $1.28 or 1.5 percent at $84.45 a barrel on expiration day.

Closer to home, Indonesia will see August figures for loan growth later today; in July, growth was at 10.71 percent.

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