Update COVID-19 in Indonesia: 70,736 confirmed infections, 3,417 deaths (9 July 2020)
6 July 2020 (closed)
USD/IDR (14,512) +26.00 +0.18%
EUR/IDR (16,454) +50.48 +0.31%
Jakarta Composite Index (5,052.79) -23.38 -0.46%
Just as unexpected as yesterday when the benchmark stock index of Indonesia (known as Jakarta Composite Index or IHSG) fell 1.06 percent amid positive domestic and international circumstances, the IHSG made a surprise rebound on Tuesday’s trading day. Yesterday’s fall was exorbitant and unfounded and today market participants made up for that performance by accumulating stocks that had lost value. As a result the IHSG gained 1.25 percent to 4,946.09 points on Tuesday (10/06).
Perhaps the market was influenced by the first debate between Indonesia’s two presidential candidates (Joko Widodo and Prabowo Subianto) which was held on Monday evening (09/06). This debate focused on the safeguarding of Indonesian democracy and law. Perhaps this topic reassured market participants, particularly foreign ones, who therefore engaged in stock buying.
Even though the Japanese yen appreciated (which is negative for the rupiah), Asian stock indices were up on Tuesday (10/06) including the Nikkei index. These Asian indices were positively influenced by rising indices on Wall Street on Monday. Moreover, Australia’s higher manufacturing production and NAB business confidence were well received by investors. China’s inflation, which rose sharply to 2.5 percent last month, added to positive market sentiments in Asia as it may indicate that Chinese consumers’ purchasing power has grown.
The Indonesian rupiah exchange rate depreciated again after a survey of Bank Indonesia showed that growth of Indonesian retails sales has slowed. The survey also showed that consumers expected prices to increase in the coming three months (inflation).