Soft Start Expected For Indonesia Stock Market

(RTTNews) - The Indonesia stock market on Wednesday ended the three-day slide in which it had slumped more than 50 points or 0.8 percent. The Jakarta Composite Index now sits just above the 6,700-point plateau although it may see renewed selling pressure on Thursday.

The global forecast for the Asian markets is negative on renewed concerns over the outlook for interest rates. The European and U.S. markets were down and the Asian markets are expected to open in similar fashion.

The JCI finished modestly higher on Wednesday following gains from the financial shares and mixed performances from the cement and resource stocks.

For the day, the index gained 42.17 points or 0.63 percent to finish at 6,702.62.

Among the actives, Bank CIMB Niaga added 0.65 percent, while Bank Negara Indonesia perked 0.28 percent, Bank Central Asia collected 0.83 percent, Bank Rakyat Indonesia gathered 0.45 percent, Indosat Ooredoo Hutchison soared 3.51 percent, Indocement rose 0.26 percent, Indofood Suskes rallied 3.15 percent, United Tractors advanced 0.97 percent, Astra International jumped 1.84 percent, Energi Mega Persada skyrocketed 4.76 percent, Astra Agro Lestari gained 0.66 percent, Aneka Tambang shed 0.50 percent, Vale Indonesia sank 0.77 percent, Timah skidded 1.04 percent, Bumi Resources surged 3.54 percent and Bank Mandiri, Bank Danamon Indonesia, Semen Indonesia and Jasa Marga were unchanged.

The lead from Wall Street remains weak as the major averages opened lower again on Wednesday and largely stayed that way, ending near session lows.

The Dow dropped 102.35 points or 0.30 percent to finish at 33,951.52, while the NASDAQ tumbled 165.10 points or 1.21 percent to close at 13,502.20 and the S&P 500 shed 23.02 points or 0.52 percent to end at 4,365.69.

Renewed concerns about the outlook for interest rates contributed to the weakness on Wall Street following remarks by Federal Reserve Chair Jerome Powell.

In testimony before the House Financial Services Committee, Powell reiterated the Fed is likely to continue raising interest rates in an effort to contain stubbornly elevated inflation.

The Fed left rates unchanged last week, but the central bank's latest projections suggest it plans to resume raising rates later this year, forecasting a rate of 5.6 percent by the end of 2023. If the Fed decided to revert to its recent quarter-point increases, the forecast suggests the central bank will raise rates two more times this year.

Crude oil prices climbed higher on Wednesday amid hopes about the outlook for demand in the U.S. and forecasts for a drawdown in U.S. crude stocks last week. West Texas Intermediate Crude oil futures for August ended higher by $1.34 at $72.53 a barrel, recovering from a low of $70.80.

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 expected to keep its benchmark lending rate (5.75 percent), deposit facility rate (5.00 percent) and lending facility rate (6.50 percent) all unchanged.