The positive response of Asian stock markets towards manufacture data from Europe, and the rebound of American and European stocks turned the Indonesia Stock Exchange (IHSG) back into green territory. Positive market sentiments impacted - as usual - on commodity stocks, particularly mining stocks, and which thus gained the most: Vale Indonesia (INCO), Antam (ANTM), Timah (TINS), and Resource Alam Indonesia (KKGI) all increased significantly.
The positive openings of Europe's stock indices also contributed to today's rise of the IHSG, although it was not enough to keep the index above the level of 4500. During today's trading day, the IHSG reached its highest level (4508.12) at the end of session one, and its lowest level (4483.06) at the start of session one. At the end of the trading day, it stood at 4498,98. Foreigners mostly bought Indonesian stocks, while domestic market participants mostly sold their Indonesian assets.
Indonesia's IDR rupiah also climbed after European manufacture data showed positive results. However, its gain was dampened somewhat by negative sentiments that surround tomorrow's meeting of the European Central Bank (ECB) and the Bank of England because France and Belgium are worried about the exchange rate of the euro becoming too strong. Market participants want to see first whether the ECB shares those concerns. It is also assumed that much money will flow back in the Euro zone as part of the Long Term Refinancing Operations (LTROs) will be repaid. Ill received news also came from Japan where the Governor of the Bank of Japan stepped down earlier than expected in order to make room for a more aggressive monetary policy in the country.
Tomorrow, the IHSG may show limited gain as it might want to test a new resistance level at 4500, while profit taking is likely to continue.
When writing this column, European stock indices were mixed. Currently, 178 European companies have reported its 2012 results, and 52% have showed higher than expected results (including Arcelor Mittal and Hargreaves Lansdown Plc.), while 53% reported higher than expected sales. However, market participants will still want to wait for the meeting between European leaders. From the USA, it is hoped that today will see more positive results from companies' annual reports and other economic data (such as the MBA Mortgage Application survey). If positive, these will impact positively on Asian stock indices tomorrow.
Top Movers – Wednesday 6 February 2013
|• Radiant Utama Interinsco
|• Ramayana Lestari Sentosa||11.61%|
|• Vale Indonesia||9.91%|
|• Ciputra Property||8.33%|
|• Lionmesh Prima
|• Panasia Indo Resources||13.98%|
|• Bank Ekonomi Raharja||11.30%|
|• Zebra Nusantara||9.91%|