JCI Rises as Political Concerns Dissipate

JANUARY 21, 2015

Jakarta. Indonesia’s financial markets rallied on Wednesday, highlighting improving investor confidence amid positive signs of political stability in the country.

The Jakarta Composite Index rose 0.95 percent to 5,215.27 with about 5.2 billion shares — valued at Rp 6.3 trillion ($288 million) — traded on the Indonesia Stock Exchange (IDX). Gainers beat decliners 162 to 144.

Foreign investors made up 26 percent of the trading activity, and bought Rp 218 billion more shares than they sold.

All sectors rose except for shares in the mining and basic industries, which both lost 0.1 percent. The miscellaneous sector, which includes automotive distributors and garment makers, rose 2.64 percent.

Shares in Astra International, the country’s biggest automotive distributor, climbed 3.02 percent to Rp 7,676, while automotive parts manufacturer Selamat Sempurna gained 3.13 percent to Rp 495.

Shares in consumer goods companies grew 2.4 percent growth as domestic goods giant Unilever Indonesia climbed 5.1 percent to Rp 35,950. Indofood gained 8.2 percent to Rp 14,500.

The yield on the government’s 10-year bonds declined to 7.3288 percent on Wednesday from 7.6758 percent the day before, according to data from the Indonesia Bond Pricing Agency (IBPA).

The rupiah strengthened to 12,557 against the US dollar, from 12,659 to the greenback on Tuesday, data from Bank Indonesia showed.

The positive growth came as the House of Representatives ratified a presidential decree to keep direct local elections, diminishing sentiments of a divided government in Indonesia. However, President Joko Widodo’s candidate for police chief and his recent appointments to his advisory board have been criticized as political concessions.

GlobeAsia

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