JCI Posts Slight Gain Amid Decreased Pressure From Foreign Investors

JANUARY 20, 2015

Jakarta. Indonesian stocks rose on Tuesday due to less pressure from foreign investors, while overall Asian stocks saw an increase.

The Jakarta Composite Index gained 13.99 points, or 0.27 percent to close at 5,166.09, extending the 0.01 gain on Monday.

More than 5.9 billion shares valued at a combined Rp 6.27 trillion ($499 million) changed hands on the Indonesia Stock Exchange (IDX). Decliners beat gainers by 169 to110. Foreign investors made up 38 percent of the day’s totals trade, having sold Rp 337 billion more in shares than they bought.

“Pressure from foreign investors has decreased especially in the cement stocks that had a slight rebound. However, the market is still volatile because investors are worried about the statements and policies of President Joko Widodo’s government,” Satrio Utomo, an analyst at Universal Broker, told the Jakarta Globe.

The saga of Joko nomination of graft suspect Comr. Gen. Budi Gunawan as the chief of police raised concern over the president’s commitment to reform and his  independence from his political backers’ interests. Joko has subsequently postponed Budi’s inauguration amid a public outcry.

Satrio also noted that gains in the Asian stocks markets lifted the mood of investors in the domestic market.

Bourses across the region went up on Tuesday after China announced that its economy grew 7.4 percent in 2014, slowing from 7.7 percent in 2013, but slightly better than what the market anticipated.

China’s SSE’s composite index rose by  1.8 percent and Hong Kong’s Hang Seng gained 0.9 percent. Japan’s Nikkei index gained 2.07 percent and South Korea’s Kospi rose 0.82 percent.

The IDX index of 41 mining stocks led the market with a 1.35 percent rise, followed by trade, services and investment stocks, which gained 1.17 percent.

Indonesian coal miner Bayan Resources lead the mining sector with 4.9 percent gain to Rp 7,000 per share.  Sejahteraraya Anugrahjaya, the operator of Mayapada Hospitals, lead the services sector with an 11 percent increase.

Telekomunikasi Indonesia, the country’s largest telecommunication company rose 1.6 percent to Rp 2,900, while Surya Citra Media, the operator of free-to-air television station Surya Citra Televisi, posted a 4.7 percent rise to Rp 3,435.

The rupiah weakened by 0.37 percent to trade at 12,659 against the dollar, compared to 12,612 on Monday, according to Bank Indonesia.

The yield of 10-year government bond, which is the benchmark for long-term interest rates, rose slightly to 7.6758 percent from 7.6750 percent a day earlier, according to data from Indonesia Bond Pricing Agency. The bond’s yield moves inversely to its price.

Additional reporting from Reuters