This Week JCI Will Stay At Level 7,000?

Illustration. (Photo: Doc. Antara)

JAKARTA - This week will be a period for the Jakarta Composite Index (JCI) to try to climb up and stay at the level of the 7,000s. So far, JCI almost always bounces and does not have a strong grip to stay at the level of 7,000.

Associate Director of Research and Investment Pilarmas Investindo Sekuritas Maximilianus Nico Demus assessed that the JCI is still difficult to consistently stay at the level of 7,000 because of pressure to take profit when stock prices rise.

"This week, the JCI is still trying to strengthen, although there is a potential for consolidation," Nico Demus said in his research, quoted Monday, March 21.

Head of Investment Research at Infovesta Utama, Wawan Hendrayana, has the same opinion. In his calculations, the JCI support for the next week will be in the range of 6,820-6,900.

"JCI has gone up quite high since the beginning of this year, so profit-taking is reasonable," said Wawan.

Although many market players are taking profit-taking, in general, Nico views the JCI valuation based on the current price to earnings ratio (PER) is still fairly reasonable. He predicts JCI will play in the range of 6,930-7,035 this week.

In addition, there are several sentiments that make it difficult for the JCI to move above 7,000. First, Bank Indonesia's decision to maintain the benchmark interest rate when the United States (US) central bank raised interest rates. This makes the difference in the benchmark interest rates between Indonesia and the US narrow and becomes a short-term negative sentiment.

Second, commodity prices have recently begun to fall. However, some of these sentiments are only short term. Moreover, the uncertainty regarding the Ukraine-Russia conflict has not disappeared.

Third, the potential for high inflation. "The government has opened the price of cooking oil in the market. Surely it will affect inflation in March, so it may be one of the negative catalysts that investors can see," said Wawan.