The large-scale strikes implied that production rates of manufacturing companies were disturbed last week, which can subsequently influence the Purchasing Managers Index (PMI) of Indonesia which might fall below 50 next month (a reading under 50 represents a contraction). In October, the country's Manufacturing PMI increased to 50.9 from 50.2 in the previous month.

Secondly, Statistics Indonesia (BPS) released the latest inflation and trade balance figures on Friday (01/11). Although the inflation result was good at 0.09 percent month-to-month in October, the trade balance recorded another deficit at USD $657.2 million in September 2013. For investors the latter was disappointing because it indicated that the Indonesian government had not done its homework regarding curbing the imports of oil and gas (the oil and gas component is what causes the deficit).

The corporate earnings reports of Indonesian companies that were released last week were mixed. A number of large-cap Indonesian companies released disappointing financial reports including Astra International as well as Indofood Sukses Makmur indicating that the robust growth pace of Indonesia's domestic consumption in recent years is somewhat slowing down. Meanwhile, financial institutions such as Bank Mandiri and Bank Central Asia are still showing impressive growth.

From abroad several positive market sentiments were imported into Indonesia. China's Manufacturing PMI was recorded at 51.4 percent in October, while Japan - the world's third largest economy - posted a 2 percent inflation rate. Lastly, Wall Street ended positive last week.

This week, I expect that there is still a high risk of correction of the IHSG. Concerns about the workers' strikes and the trade deficit continue, while weak financial reports of several companies cause investors to become insecure about the Indonesian market. Moreover, Indonesia's gross domestic product (GDP) growth is expected to fall to 5.6-5.8 percent in the third quarter of 2013. Therefore, it seems that if the IHSG wants to avert a correction this week then it will need the support of positive external factors: rising global indices.

The support level of the IHSG is 4,350, while there is still a gap at 4,200. Investors are advised to carefully look at which companies are still able to post a significant rise in revenues during quarter III-2013.