Macro Stability Can Support JCI in the Middle of US-Venezuela Tensions

JAKARTA - Indonesian Capital Market Observer Reydi Octa said that domestic macroeconomic stability supported the performance of the Composite Stock Price Index (JCI) amid the conflict between the United States (US) and Venezuela.

"The strengthening of the JCI today is more driven by domestic and regional sentiments, not the US and Venezuelan conflict," Reydi said when contacted by Antara in Jakarta, Monday, January 5.

He explained that market participants saw that the conflict between the two countries had not had a systemic impact on the global financial market, so it did not trigger significant selling.

From within the country, he said the JCI was supported by macro stability, early year optimism, and rotation to energy and gold commodity sector stocks which benefited from global uncertainty.

"This combination makes the JCI still strengthen even though there are external geopolitical sentiments," said Reydi.

Earlier this year, he explained that market participants tend to focus on fundamental factors, not short-term geopolitical issues.

Meanwhile, the fundamental factors in question are such as the direction of global interest rate policies, especially the expectation of interest rate cuts by the US central bank The Fed.

In addition, there is also the stability of domestic economic policy after the transition of the government, the performance of the issuer's profit, especially the caps, and the movement of commodity prices such as oil and gold.

As is known, the US attacked and arrested Venezuelan President Nicolas Maduro and his wife on Saturday (03/01), where Maduro was later taken to New York, USA.