Indonesian Stock Market Update: Bad Day for the Astra Group
Ahead of central bank meetings in the USA and Japan, and amid a volatile performance of crude oil prices the benchmark stock index of Indonesia (Jakarta Composite Index) fell 1.33 percent to 4,814.09 points on Tuesday (26/04), leading losses among Asian indices. The Federal Reserve's two-day FOMC meeting, scheduled to start today, is making investors cautious as this meeting may give some clues about the possibility of a June Fed Fund Rate hike. Overall, the performance of Asian stock markets was rather mixed on Tuesday. This performance was also attributed to weak cues from Wall Street and Europe overnight.
Shares of Astra International, one of Indonesia's largest listed companies in terms of market capitalization, fell 2.04 percent as the company is expected to post disappointing earnings over Q1-2016. Shares of its subsidiary United Tractors fell 3.12 percent on today's trading day. Meanwhile, shares of another Astra subsidiary, Astra Graphia, plunged 3.48 percent after the company announced that its net profit had fallen 8.3 percent (y/y) in Q1-2016.
Besides the aforementioned external factors there may also be one internal factor that caused Indonesia's Jakarta Composite Index to lead losses in Asia today. Yesterday, the Indonesia Investment Coordinating Board (BKPM) announced that foreign direct investment (FDI) into Indonesia grew 17.1 percent (y/y) to IDR 96.1 trillion in the first quarter of 2016. Although this is a positive message, FDI realization fell on a quarter-to-quarter basis. In Q4-2015 FDI realization stood at IDR 99.2 trillion. It was the first time since Q4-2011 that FDI realization in Indonesia slowed on a quarterly basis. This suggests that FDI is slowing and thus curbs Indonesia's overall economic growth.
Meanwhile, the central bank of Japan will also start its monthly policy meeting this week. Several macroeconomic data that are scheduled to be released before the start of this meeting include Japan's consumer price index, unemployment, retail sales and industrial production. Investors expect Japan's central bank to decide to raise stimulus measures at this policy meeting.
Although most Southeast Asian currencies, including the rupiah (Bloomberg Dollar Index), depreciated against the US dollar ahead of the Federal Reserve's two-day policy meeting. Bank Indonesia's benchmark rupiah rate (Jakarta Interbank Spot Dollar Rate, abbreviated JISDOR) appreciated 0.15 percent to IDR 13,215 per US dollar on Tuesday (26/04).
Indonesian Rupiah versus US Dollar (JISDOR):| Source: Bank Indonesia