Jakarta Market Roundup: Investors Stay Quiet Ahead of Fed Rate News
Muhamad Al Azhari
Indonesia’s benchmark stock index slipped from a more-than-two-month high on Wednesday as investors held back from making big stock purchases ahead of a monetary policy-setting meeting by the US Federal Reserve.
The Jakarta Composite Index slipped 11.87, or 0.3 percent, to 4,130.47, after closing on Tuesday at its highest level since May 8.
More than 4 million shares valued at Rp 4.9 trillion ($517 million) changed hands on the Indonesia Stock Exchange (IDX).
Decliners outnumbered gainers, 136 to 107. Foreign investors sold Rp 141 billion more in shares than they bought
The US central bank concluded its two-day meeting on Wednesday, hours after the close of trading in Jakarta, at which monetary policy was to be discussed. It has kept its key policy rate at a record low 0.25 percent since December 2008 in a bid to boost growth in the world’s biggest economy.
Indonesia’s market was also affected by negative sentiment from the region as investors awaited statements from the Fed on its monetary policy, Purwoko Sartono, an analyst at brokerage Panin Sekuritas in Jakarta, was quoted as saying by Antara.
Stocks were also hit by “profit taking … by investors, after the index gained in the past few days” on the back of positive sentiment from earnings announcements, he said. Most companies had reported first-half results by Wednesday.
The rupiah rose to 9,468 per US dollar on Wednesday from 9,485 of the previous day’s trading, according to Bank Indonesia, the central bank.
A government report showed that inflation rose for a fourth straight month in July. Still, the increase might not be enough to compel the central bank to raise its key interest rate, which is currently at a record low.