JCI Prediction After RI's 80th Anniversary Long Holiday

Illustration. (Photo: Doc. Antara)

JAKARTA - On Friday, August 15, the Composite Stock Price Index (JCI) closed lower by 0.41 percent at 7,898.37. JCI had penetrated the psychological level of 8,000 and touched the highest point at the level of 8,017.06 in trading last Friday.

However, in a week the JCI recorded an increase of 4.84 percent. The Korea Investment and Indonesian Securities Research Team (KISI) said the increase in the JCI last week was influenced by a number of factors.

First, the extension of the United States (US)-China import tariff break for 90 days has reduced concerns related to the trade war. Second, moderate US inflation data, thus making strong expectations of cutting the Fed interest rate.

Third, the flow of foreign funds that re-entered the Indonesian stock market. According to a survey from the Bank of America, as many as 37 percent of global investment managers now have a larger portion in the stock market in developing countries.

So, what are the predictions of the JCI movement after the long holiday of the 80th Indonesian Independence Day? KISI Research Team predicts, this week (19-22 August), JCI moved mixed in the range of 7,725 - 8,150.

Sentimen dari pasar global menurut Tim KISI, bursa saham AS berpotensi melanjutkan tren penguatan meskipun ruang konsolidasi terbuka, mengingat valuasi sudah tinggi.

"The focus of investors is currently on the release of FOMC minutes on August 20 which can signal the amount and opportunity to cut interest rates in September," wrote the KISI Research Team.

Then, the Asian exchange is projected to move mixed with a positive trend with the Japanese Consumer Price Index (CPI) catalyst and China's Loan Prime Rate (LPR) decision.

"China stimulus and controlled inflation can encourage the consumption, property and export sectors, while geopolitical concerns could hold back rallies in some markets," explained the KISI Research Team.

Domestically, JCI tends to consolidate after breaking through the 8,000 intraday level last Friday.

The main catalyst is the decision of the Bank Indonesia (BI) interest rate on August 20 which is estimated to remain at 5.25% with a dovish tone to support credit growth and distribution.

BI's accommodative stance, continued flow of foreign funds, and positive sentiment from China's policy have the potential to raise the consumer, technology and transportation sectors.

"Meanwhile, the banking sector will be sensitive to liquidity signals and rupiah stability," said the KISI Research Team.