Domestically, JCI’s movement rate was halted amid plans to extend the emergency PPKM to 6 weeks. Investors also responded negatively to the 2021 economic growth revision from the Ministry of Finance and Bank Indonesia. Technically, JCI will try to stay above the psychological level of 6,000; with a projected daily range of 5,950 – 6,130.
A number of market players are interested in long tenor Government Securities (SUN), amid the potential for the domestic economy to erode again.
In line with the majority of global exchanges, JCI managed to start the week with a strengthening; supported by foreign net buy of IDR 872 billion. Continuing effort to handle the Covid-19 pandemic is still a positive catalyst for stocks in the health sector. For today, JCI will try to maintain gains in a higher range at 6,026-6,134.
On Thursday (07/07), Bank Indonesia (BI) recorded Indonesia’s foreign exchange (forex) reserves in June 2021 at USD137.1 billion. It was relatively stable compared to the previous month at USD136.4 billion.
The market’s movement this week will be influenced by several domestic and global sentiments. Investors will assess the effectivity of Emergency PPKM that has been implemented for a week in order to curb Covid-19 infection rate. Meanwhile, Statistics Indonesia will release Trade Balance for June period, which by consensus is projected at USD1.88 billion. On the global market, market participants will observe the movement of US 10 Year Treasury Yield which fell to around 1.3%.
Over the past week, JCI was still able to gain 0.3%; amid the foreign net sell actions that amounted to IDR 537 billion. Market participants will pay close attention to developments in the handling of the Covid-19 pandemic as we enter the 2nd week of Emergency PPKM implementation. Although it tends to move flat, today the JCI still has the opportunity to limitedly strengthen in the range of 5,985 – 6,130.
The United States (US) Dollar Index had weakened ahead of weekend trading. Market participants are also worried about the US economy, due to the spread of the delta variant of COVID-19 which is easier to infect.
In addition to the decline in UST yields, market participants responded positively to the increase in the Consumer Confidence Index (IKK) for the June period which was at the level of 107.4.
From the domestic market, investors’ wait and see attitude still caused the JCI to tend to move mixed. The strengthening of commodity prices and the government’s plan to add PMN to several SOEs are expected to offset the sentiment of rising daily positive cases. Towards the end of the week, JCI is expected to remain mixed in the range of 5,950 – 6,130.
