During the last week of July, JCI weakened by 0.52 percent with foreign net sales reaching more than IDR 1 trillion. Market participants will pay close attention to the decision to extend the PPKM level 4 as well as the release of monthly economic data such as inflation rate and Manufacturing PMI. Technically, the benchmark index is projected to still move in the consolidation range of 6.000-6,160.
Approaching August, JCI’s movement may be influenced by some economic data releases which are scheduled for the first week of the month. Investors will pay close attention to the impact of stricter PPKM on inflation and Manufacturing PMI for July 2021.
The easing of the wider Level 4 Community Activity Restrictions (PPKM) may be delayed, as the Delta Plus variant is discovered in Indonesia.
In line with the majority of global markets, JCI managed to close in the green zone although it has not been able to get out of the consolidation range. Increases were recorded in 8 of the 11 main sectors; amid optimism that more foreign funds will enter after the Fed maintains interest rates. Towards the end of the week, the JCI has the opportunity to continue strengthening with a range of movement at 6,000-6,166.
In the latest report, the IMF cut its economic growth projections for emerging market countries, particularly ASEAN 5 (Indonesia, Malaysia, Philippines, Thailand, Vietnam) in 2021 by 4.3%.
From the domestic market, the JCI slightly weakened by 0.14%; in the midst of a net sell by foreign investors of IDR 329 billion. The results of the Federal Reserve meeting and the developments of the Covid-19 pandemic are the sentiments the affect the market. Technically, JCI still has the potential to continue weakening with a range of movement at 6,000 – 6,166.
The results of the Sukuk auction yesterday, recorded a total bid of IDR 56.69 trillion.
Domestically, JCI resumed its sideways phase after a slight decline of 0.15%; with 7 out of 11 sectors declining. The market is still watching the developments of the Covid-19 pandemic; where Indonesia recorded the highest rates of recovery and death. For today, the JCI is expected to remain under pressure with a range of movement at 6,000 – 6,166.
A number of market participants are relatively wait and see, amid the lack of positive sentiment this week.
