Stocks in Asia were mostly up on Tuesday (12/04) supported by the weaker Japanese yen (retreating after a seven-day rally again the US dollar) and rising commodity prices (with crude oil touching a 2016 high at USD $43 per barrel after the US dollar weakened). Indonesia's benchmark Jakarta Composite Index rose 0.89 percent to 4,829.57 points, while the rupiah appreciated 0.14 percent to IDR 13,115 per US dollar (Bloomberg Dollar Index). Several analysts claim that the positive performance of Indonesian assets was also due to the government's plan to cut the corporate income tax to 20 percent and raise the non-taxable personal income tax by 50 percent.

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Despite last week's rallying oil prices, rising stocks on Wall Street and in Europe, as well as expectation of a more gradual increase in US interest rates, Indonesia's benchmark stock index (Jakarta Composite Index) plunged 1.23 percent on Monday (11/04). Overall, the performance of Asian stock markets was mixed reflected by stock trading in the two big economies of China and Japan. Whereas Japanese stocks fell due to the stronger yen (touching a new 17-month high against the US dollar), Chinese stocks climbed on easing worries about deflationary pressures (after China's March CPI inflation remained flat at 2.3 percent y/y).

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Most emerging market stocks and currencies strengthened today as markets responded positively to Federal Reserve Chairwoman Janet Yellen's dovish statements overnight. Based on her words, the Federal Reserve is not expected to undertake another US interest rate hike soon as the US economy remains fragile amid sluggish global economic growth. As a result Indonesia's benchmark Jakarta Composite Index climbed 0.74 percent, while the Indonesian rupiah appreciated 1.04 percent to IDR 13,256 per US dollar (Bloomberg Dollar Index).

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In line with the performance of most emerging stock markets and currencies, Indonesian stocks and the rupiah were under pressure on Monday (28/03). The Jakarta Composite Index fell 1.11 percent, while the Indonesian rupiah depreciated 0.73 percent to IDR 13,343 per US dollar (Bloomberg Dollar Index). This performance is caused by rising speculation that the US Federal Reserve could hike its key Fed Fund Rate as early as April. Several Fed officials have made hawkish comments, while the upward revised 1.4 percent GDP growth of the US economy in Q4-2015 may show that the US is strong enough to cope with another rate hike.

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Asian stocks were mixed after opening on the first trading day of the new week. Energy stocks are mostly down due to another retreat in global oil prices. Oil prices continued Friday's slide due to ongoing concern over excessive supply after last week's US rig count grew for the first time since December 2015. This implies pressure on "commodity-driven" assets, which includes Indonesian stocks and the rupiah. The Indonesian rupiah had depreciated 0.27 percent to IDR 13,152 per US dollar (Bloomberg Dollar Index), while the benchmark Jakarta Composite Index was down 0.07 percent by 09:15 am local Jakarta time.

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Stock markets in Asia as well as Asian emerging market currencies should perform well today after the US Federal Reserve left rates unchanged at its March policy meeting. Moreover, the central bank of the world's largest economy stated that it expects fewer rate hikes in the coming months (dovish outlook) as economic recovery of the USA is still fragile amid slower global growth and turmoil in world markets linked to low oil price. As a result risk sentiment improved sharply, while the US dollar suffered losses.

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The Indonesia Stock Exchange (IDX) will summon 18 listed companies to explain why they did not comply with the new minimum 7.5 percent free float regulation (free float is the number of companies' outstanding shares available to the public for trade). This new regulation, announced in January 2014, stipulates all listed companies on the IDX to have a minimum free float ratio of 7.5 percent per 31 January 2016 (BEI No. Kep-00001/BEI/01-2014). This regulation was designed in an attempt to boost market liquidity and raise trade volume on the IDX.

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Most Asian stock markets fell on Tuesday (23/02) on extended concerns about the world's low crude oil prices and China's economic slowdown. Indonesia's benchmark Jakarta Composite Index (IHSG) plunged 1.16 percent to 4,654.05 points, leading declines in Asia as the nation's banking shares were also affected by local financial authorities' plans to curtail the net interest margin in order to bring down Indonesian banks' lending rates and boost credit expansion in Southeast Asia's largest economy.

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Indonesia's benchmark Jakarta Composite Index (IHSG) rose 0.24 percent to 4,708.62 points, while the Indonesian rupiah appreciated 0.52 percent to IDR 13,439 per US dollar (Bloomberg Dollar Index) on Monday (22/02) amid mostly rising emerging market stocks and appreciating emerging market currencies. Investor appetite for riskier assets was triggered by higher global oil prices and rallying Chinese shares (brought about by optimism after the appointment of a new chairman of the China Securities Regulatory Commission.

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This morning various economic data were released in Asia, most importantly data from China and Japan. China posted a record USD $63.3 billion trade surplus in January 2016, while Japan saw its gross domestic product (GDP) contract more-than-expected at 1.4 percent (y/y) in the fourth quarter of 2015. However, despite weak GDP growth data Japanese stocks managed to surge, while Chinese stocks tumbled after the record monthly trade surplus. How is that possible? And what about Indonesian assets today?

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On the last day of the week (07/03), Indonesia's benchmark stock index (Jakarta Composite Index or IHSG) fell 0.04 percent to 4,685.89 points as market participants engaged in profit taking (cashing in on the recent strong performance of the IHSG) amid resurging concerns about the situation in Ukraine. On the other hand, losses were limited as investors are upbeat about the improved outlook for the global economy. US data were good as the number of people who filed for unemployment benefits fell to the lowest level in three months.

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Rising indices on Wall Street on Tuesday (04/03) impacted positively on Asian indices the following day, including Indonesia's benchmark stock index (known as the Jakarta Composite Index or IHSG). As the political tensions in Ukraine have somewhat eased since Russian President Vladimir Putin said that Russia was not seeking to escalate the conflict, investors were again eager to invest in emerging market stocks; foreign investors were net buyers. Today's performance of the IHSG left a gap at 4,602-4,621 points.

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Yesterday (26/02) strengthening Asian stock indices were unable to push the benchmark index of Indonesia (Jakarta Composite Index/IHSG) into the green zone. Today (Thursday 27 February), we witnessed the contrary: the IHSG climbed 0.80 percent to 4,568.94 points, while Asian indices were mixed. Indices in China, the Sensex and the Nikkei fell, while others rose. Those that rose responded positively toward the release of higher sales of new US single-family homes. However, the conflict in the Ukraine limited their growth.

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When there are few positive sentiments that can push Indonesia's benchmark stock index (Jakarta Composite Index, also known as IHSG) into higher territory there is always the risk of downreversal due to profit taking. Particularly as the IHSG has shown a steady rising trend in recent weeks. The IHSG's decline on Monday (24/02) was influenced by falling Asian indices after a sell off of property and construction stocks emerged. The continued appreciation of the Indonesian rupiah exchange rate was also unable to provide enough support for the index.

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Foreign confidence in Indonesia's capital markets seems to be growing further after foreign investors continued to expand their stock portfolios last week. In February 2014 (up to Friday 21/02), foreigners purchased IDR 36.0 trillion (USD $3.1 billion) worth of stocks and sold IDR 29.3 trillion (USD $2.5 billion), resulting in net foreign buying of 6.7 trillion (USD $570.2 million) in the first three weeks of February 2014. When foreign net buying of January 2014 is added, total net foreign buying reached IDR 9.0 trillion (USD $766.0 million).

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Despite being - technically - overbought, the Jakarta Composite Index (Indonesia's benchmark stock index also known as the IHSG) continued its upward trend on Wednesday (19/02). Moreover, as market sentiments have turned less positive due to data from Europe and the USA (causing European and American indices to slow down) as well as a depreciating rupiah exchange rate, there was a sincere risk of a weakening IHSG today. However, contrary to our expectations, the IHSG rose 0.80 percent to 4,592.65 points.

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As we have explained before, a significant amount of market participants will engage in profit taking after a day (or in this case a number of days) of gain. Mixed sentiments originating from the Asian continent, particularly Japan and China, as well as the depreciating Indonesian rupiah exchange rate contributed to the slight gain of Indonesia's benchmark index (known as the Jakarta Composite Index or IHSG). The IHSG rose 0.02 percent to 4,556.19 points on Tuesday (18/02).

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The Jakarta Composite Index (Indonesia's benchmark stock index, also known as IHSG) continued its upward rally on Monday (17/02) even though it had concerned us that the index almost touched its 'overbought' level. Especially as the index posted limited gain by the end of last week, it made us unsure about its performance on Monday. And while there are several factors that caused positive market sentiments, we still warn for potential weakening of the index due to profit taking. On Monday (17/02), the IHSG rose 1.05% to 4,555.37 points.

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The weakening Dow Jones Index on Wednesday (12/02) caused negative market sentiments in Asia the following day. Most Asian indices, including Indonesia's Jakarta Composite Index (IHSG), were down. Not even the announcement that Bank Indonesia decided to maintain its benchmark interest rate (BI rate) at 7.50 percent was able to push the IHSG back in the green zone. Investors probably already anticipated the central bank's decision as it was in line with the market's expectation.

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Positive market sentiments stemming from Wall Street pushed Indonesia's benchmark stock index (known as the Jakarta Composite Index or IHSG) further up on Wednesday (12/02). Even though technical indicators (such as the bollinger band) suggest that the majority of Indonesian stocks are close to the overbought area, it did not prevent investors from stock trading. The appreciating rupiah exchange rate, rising Asian indices and positive openings in Europe all contributed to the IHSG's 0.58 percent gain to 4,496.29 points.

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