JAKARTA-- In the midst of the pressure on the exchange rate on the US dollar, the Indonesian stock market performance even more sturdy. Last week, trade in Indonesian stock exchange ended with the achievement of a new record Composite Stock Price Index, or JCI exceed 5500 levels.
In trading on Friday (9/3), stock index closed at 5514.79, rose 1.17% from the previous hasi. JCI growth reached 5.51% since the beginning of the year; contrast with the exchange rate since the beginning of this year is still under pressure.
This condition indicates the stock investors are not too bothered to pressure experienced dollars, because pelemahannya considered not represent economic fundamentals. It is at the same time also gives confidence that market participants still believe in the economy of Indonesia and Indonesian stocks.
The indication appears on the buying of foreign investors, which recorded a net buying Rp11,71 trillion since the beginning of the year. In fact, it is believed, these foreign investors to invest long term through the Indonesian stock exchange, and not too 'upset' with the exchange rate fluctuating in the short term due to various factors.
Indonesia's economic fundamentals, in the middle of the political situation is still turbulent, still believed to be solid thus strengthen the confidence of foreign investors. It should be a provision for domestic investors, that the Indonesian stock market is increasingly promising.
Therefore, it is important for domestic investors to hurry and do not miss the train, to go up along the Indonesian capital market. Moreover, the increase in space for the index is still very open, remain open despite the risk of profit-taking in the short term. Moreover, many issuers are promising, also new issuers and issuers who were 'queue' went public. Although the price of a stock relative premium, as indicated by the average price-to-earnings ratio of 18.9 times, does not mean the space for JCI is fixed.
The risk of profit-taking may occur, but in line with the improvement in economic fundamentals and earnest efforts of the government to ensure that the economic and political policies will run as the right track, is expected to further strengthen market confidence.
Moreover, the latest projections from the Bank Indonesia said that the current account deficit will shrink at the level of 1.6% - 1.8% of gross domestic product (GDP) in the first quarter / 2015, lower than the previous projection is estimated at 2.8% .
It also proves that the weak exchange rate is not always bad, it refers to data from Bank Indonesia. This is considering the manufacturing sector helped by improving exports, which led to the current account deficit improved.
Clearly the risk of economic fundamentals Indonesia decreased significantly, given in the fourth quarter / 2014 current account deficit still reached US $ 6.2 billion, or 2.81% of GDP. This figure continues to decline as compared to the current account deficit in the third quarter / 2014 still reached US $ 7 billion, or 2.99% of GDP.
Thus, this condition adds to the belief that there is a lot of fundamental risks are worth worrying about. Moreover, the government is raising the acceleration of infrastructure projects supported by the widening fiscal space, in order to improve national productivity and efficiency.
In addition, there is also a belief that conditions are getting healthy budget management without much burdened mis-targeted subsidies, so that the risk of mismanagement of shrinking budgets.
One factor that is observed is the social and political stability. However, the challenge of political stability in the beginning of the administration of President Jokowi has provided important lessons that the new government have different leadership styles.
Trial and adjustment period is expected to give different results, of course, in the form of the effectiveness of policy and implementation in the field. If it can be shown by the administration of President Jokowi, as well as their impact can be perceived by market participants in a time not too long, then the confidence in Indonesia will be more robust, and sustainable.
END
Bisnis Indonesia
In trading on Friday (9/3), stock index closed at 5514.79, rose 1.17% from the previous hasi. JCI growth reached 5.51% since the beginning of the year; contrast with the exchange rate since the beginning of this year is still under pressure.
This condition indicates the stock investors are not too bothered to pressure experienced dollars, because pelemahannya considered not represent economic fundamentals. It is at the same time also gives confidence that market participants still believe in the economy of Indonesia and Indonesian stocks.
The indication appears on the buying of foreign investors, which recorded a net buying Rp11,71 trillion since the beginning of the year. In fact, it is believed, these foreign investors to invest long term through the Indonesian stock exchange, and not too 'upset' with the exchange rate fluctuating in the short term due to various factors.
Indonesia's economic fundamentals, in the middle of the political situation is still turbulent, still believed to be solid thus strengthen the confidence of foreign investors. It should be a provision for domestic investors, that the Indonesian stock market is increasingly promising.
Therefore, it is important for domestic investors to hurry and do not miss the train, to go up along the Indonesian capital market. Moreover, the increase in space for the index is still very open, remain open despite the risk of profit-taking in the short term. Moreover, many issuers are promising, also new issuers and issuers who were 'queue' went public. Although the price of a stock relative premium, as indicated by the average price-to-earnings ratio of 18.9 times, does not mean the space for JCI is fixed.
The risk of profit-taking may occur, but in line with the improvement in economic fundamentals and earnest efforts of the government to ensure that the economic and political policies will run as the right track, is expected to further strengthen market confidence.
Moreover, the latest projections from the Bank Indonesia said that the current account deficit will shrink at the level of 1.6% - 1.8% of gross domestic product (GDP) in the first quarter / 2015, lower than the previous projection is estimated at 2.8% .
It also proves that the weak exchange rate is not always bad, it refers to data from Bank Indonesia. This is considering the manufacturing sector helped by improving exports, which led to the current account deficit improved.
Clearly the risk of economic fundamentals Indonesia decreased significantly, given in the fourth quarter / 2014 current account deficit still reached US $ 6.2 billion, or 2.81% of GDP. This figure continues to decline as compared to the current account deficit in the third quarter / 2014 still reached US $ 7 billion, or 2.99% of GDP.
Thus, this condition adds to the belief that there is a lot of fundamental risks are worth worrying about. Moreover, the government is raising the acceleration of infrastructure projects supported by the widening fiscal space, in order to improve national productivity and efficiency.
In addition, there is also a belief that conditions are getting healthy budget management without much burdened mis-targeted subsidies, so that the risk of mismanagement of shrinking budgets.
One factor that is observed is the social and political stability. However, the challenge of political stability in the beginning of the administration of President Jokowi has provided important lessons that the new government have different leadership styles.
Trial and adjustment period is expected to give different results, of course, in the form of the effectiveness of policy and implementation in the field. If it can be shown by the administration of President Jokowi, as well as their impact can be perceived by market participants in a time not too long, then the confidence in Indonesia will be more robust, and sustainable.
END
Bisnis Indonesia
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