The Indonesian stock market turned right back to the upside again on Friday, one session after it had ended the two-session winning streak in which it had collected nearly 90 points or 3.4 percent en route to a two-year closing high. The Jakarta Composite Index moved above the 2,740-point plateau, but now analysts are expecting renewed selling pressure at the opening of trade on Monday.
The global forecast for the Asian markets calls for continued softness as commodity prices remain under pressure on a strengthening U.S. dollar. The trail in China of four Rio Tinto employees also kicks off today, which could lend additional pressure on the mining stocks. Technology stocks also may feel the heat, along with airlines and properties. The European and U.S. markets finished modestly lower on Friday, and now the Asian bourses are tipped to continue that trend.
The JCI finished slightly higher on Friday, as gains among the resource stocks were largely offset by selling among the financial shares.
For the day, the index put on 5.73 points or 0.2 percent to finish at 2,742.97 after trading between 2,725.65 and 2,758.13. Volume was 4.6 billion shares worth 4.8 trillion rupiah.
Among the actives, Perusahaan Gas Negara added 3.7 percent, while Unilever Indonesia gained 2.1 percent and Bank Danamon shed 4.6 percent.
The lead from Wall Street is modestly negative as stocks closed lower by moderate margins on a quadruple witching Friday, with some profit taking and overseas inflation and credit concerns prompting a pullback. The major averages all closed in negative territory, moving off of the more than one-year highs reached this week.
With no first-tier economic data, news from the Reserve Bank of India grabbed market attention, as the institution announced that it is raising its key interest rates by 25 basis points to battle inflation, which reached a sixteen-month high according to data released earlier in the week. The Indian central bank raised rates to 3.5 percent from a record low of 3.25 percent, the first rate hike since July of 2008.
Back in the U.S., healthcare reform remained a key market focus ahead of the weekend, during which the House of Representatives will take a crucial vote on the legislation. President Barack Obama held a campaign-style rally hoping to show wavering lawmakers the popularity of the proposal.
Corporate news was also on the radar as a Chinese newspaper reported that Google Inc. (GOOG) decided to cease operations in China beginning in early April. The web giant is expected to make an official announcement on Monday.
Also on the corporate front, uniforms and business services provider Cintas Corp. (CTAS) posted third quarter net income of $0.32 per share, topping Wall Street expectations for $0.30 per share. Revenues for the third quarter totaled $861.8 million, also beating projections.
The major averages moved off their worst levels going into the close but still posted notable losses on the day. The Dow fell by 37.19 points or 0.4 percent to 10,741.98, the NASDAQ slid by 16.87 points or 0.7 percent to 2,374.41 and the S&P 500 slipped by 5.92 points or 0.5 percent to 1,159.90.
Despite the pullback, the major averages all saw gains on the week, with the Dow and the S&P 500 advancing by 1.1 percent and 0.9 percent, respectively, while the NASDAQ edged up by 0.3 percent.
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