At the start of the week, when many stock markets were closed due to Easter celebrations, the IHSG lacked a reference point. Moreover, it seemed as if market participants had consumed most 2012 company reports, were not waiting for additional ones, and decided to sell part of their stock portfolios. However, considering the full week, foreigners made net purchases of IDR 817.75 billion (USD $84.30 million), up from IDR 670.54 billion (USD $69.13 million) last week.

The publication of Indonesia's March inflation rate - which was higher than expected at 5.90 percent (YoY) - did not impact negatively on the index. In fact, gaining consumer stocks were the main pillar of support for the index. Weakening American stock markets at the start of the week, also did not put real downward pressure on the IHSG as good company results and news about dividend payouts supported the IHSG and pushed the index to a new record level at 4,981.47. The psychological boundary of 5,000 points, however, came too early. The IHSG is in overbought condition and for market players that means they will take any negative market sentiment to engage in profit taking.

The IDR rupiah weakened during the week in line with a high March inflation rate of 0.63 percent (MoM), the highest March inflation rate in five years, but lower compared to February's result. Core inflation (at 4.21 percent) is still within the target range of Indonesia's central bank (3.5-5.5 percent). Other negative news came from February's export and import numbers. Indonesia's export in February weakened 2.51 percent (MoM) or 4.50 percent (YoY). Despite a falling import number, the country's trade balance still showed a deficit of about USD $330 million. For Indonesia's it is a worrying fact as trade deficits have been few in the past.

Tankan Manufactures Index and China's Factory Output Index managed to support the rupiah but it turned out to be short-lived as various negative market sentiments emerged. These include: Mario Draghi's (president of the ECB) statement that he saw room for further interest cuts, political turmoil in Italy, still unclear emergency liquidity provision from the ECB in the form of Outright Monetary Transactions (OMT), the resignation of the Finance minister in Cyprus, lower Australian New Home Sales (MoM), and the statement of a Federal Reserve official (William Dudley) who said that the bond-buying program might be phased out gradually towards the end of the year. The Bank of Japan, on the other hand, decided to step up its asset purchases (up to seven trillion yen) to boost the country's economy, and which sent Japanese bond yields to record lows. This step weakened the Japanese yen, and strengthened the US dollar.

| Source: Bank Indonesia

Asian stock markets were mixed this week, except for the Nikkei which gained towards the end of the week. The mixed performance was particularly brought on by a weakening of US Manufacturing Index. Hong Kong's HSI rebounded after property as well as oil & gas stocks gained as oil consumption was reported to have increased in February. However, at the end of the week the index fell due to negative sentiments that came from news about the bird flu epidemic. Both Shanghai and KOSPI fell due to political tensions in Korea, despite China's increased HSBC Manufacturing PMI and the increasingly positive trade balance of South Korea.