Stock trading at the Indonesia Stock Exchange (IDX) restarted on Wednesday (22/07) after the four-day Idul Fitri holiday ended. Shortly after opening on Wednesday, Indonesia’s benchmark Jakarta Composite Index (IHSG) rose 0.50 percent on investors’ optimism about the recent good performance of global stock markets after debt-ridden Greece reached an agreement with its international creditors while turmoil in Chinese stocks faded. Not long after opening, however, Indonesian shares were dragged down by other Asian indices.
Generally, Asian stock indices were lower on Wednesday as they followed the movement of US and European market yesterday. Yesterday, the Dow Jones Industrial Average lost 1 percent, Standard & Poor’s fell 0.21 percent, and Nasdaq declined 0.2 percent due to weak corporate earnings of several US companies including Apple, IBM and United Technologies. Meanwhile, markets remain focussed on the timing of higher US interest rates.
Also the slump in commodity prices continues to persist (especially this week's dramatic slide in gold prices) and triggers concerns about global economic growth. Indonesia’s central bank (Bank Indonesia) announced on Wednesday morning that it revised down economic growth for for-year 2015 to the range of 5.0-5.2 percent (from the range of 5.0-5.4 percent previously). The revised forecast is still an optimistic one and needs to be supported by improved infrastructure spending.
By 10:36 am local Jakarta time, the Jakarta Composite Index had fallen 0.19 percent. Meanwhile, Bank Indonesia's benchmark rupiah rate (Jakarta Interbank Spot Dollar Rate, abbreviated JISDOR) depreciated 0.29 percent to IDR 13,368 per US dollar on Wednesday (22/07).
Indonesian Rupiah versus US Dollar (JISDOR):| Source: Bank Indonesia
However, trading on the IDX is expected to remain soft for the remainder of the week as many people are still enjoying their (extended Idul Fitri) holiday.