More Profit Taking Expected For Indonesia Stock Market

(RTTNews) - The Indonesia stock market on Wednesday ended the four-day winning streak in which it had gathered more than 175 points or 2.7 percent. The Jakarta Composite Index now rests just above the 6,765-point plateau and the losses may accelerate on Thursday.

The global forecast for the Asian markets is soft on renewed concerns over the outlook for interest rates and recession fears. The European markets were mixed and little changed and the U.S. bourses were sharply lower and the Asian markets are tipped to follow the latter lead.

The JCI finished barely lower on Wednesday following losses from the cement companies and mixed performances from the financials and resource stocks.

For the day, the index dipped 1.55 points or 0.02 percent to finish at 6,765.79.

Among the actives, Bank Danamon Indonesia skidded 1.15 percent, while Bank Negara Indonesia lost 0.56 percent, Bank Central Asia fell 0.30 percent, Bank Mandiri tanked 2.05 percent, Bank Rakyat Indonesia collected 0.88 percent, Indocement retreated 1.50 percent, Semen Indonesia plunged 3.11 percent, Indofood Suskes rallied 1.83 percent, United Tractors strengthened 1.75 percent, Astra International jumped 1.80 percent, Astra Agro Lestari advanced 0.93 percent, Aneka Tambang shed 0.44 percent, Vale Indonesia declined 1.32 percent, Timah tumbled 1.93 percent, Bumi Resources gained 0.68 percent and Bank CIMB Niaga, Indosat Ooredoo Hutchison and Energi Mega Persada were unchanged.

The lead from Wall Street is broadly negative as the major averages were unable to hold early support on Wednesday, quickly heading south and finishing near daily lows.

The Dow plummeted 613,89 points or 1.81 percent to finish at 33,296.96, while the NASDAQ tumbled 138.10 points or 1.24 percent to close at 10,957.01 and the S&P 500 sank 62.11 points or 1.56 percent to end at 3,928.86.

The weakness that emerged on Wall Street came after St. Louis Fed President James Bullard commented that the central bank needs to quickly hike interest rates above 5 percent, shelving much of the recent optimism over interest rates.

Disappointing economic data also weighed as the Commerce Department reported a steep drop in U.S. retail sales in December. A separate report from the Federal Reserve showed industrial production in the U.S. fell by much more than expected in December.

As a result of the data, treasuries showed a substantial move to the upside, further stoking fears for the outlook of interest rates.

Crude oil futures settled lower on Wednesday amid concerns about a possible U.S. recession. West Texas Intermediate Crude oil futures for February ended lower by $0.70 or 0.9 percent at $79.48 a barrel.

Closer to home, the central bank in Indonesia will wrap up its monetary policy meeting later today and then announce its decision on interest rates. The bank is widely expected to keep its benchmark lending rate steady at 5.50 percent.