Although we are still waiting for the official announcement (which is expected to follow shortly), more and more signs are pointing towards the nomination of Jusuf Kalla as the running mate (or vice-presidential candidate) of Jakarta Governor Joko "Jokowi" Widodo in the presidential election that is scheduled for 9 July 2014. The pair will have the full support of the PDI-P, NasDem, PKB and Hanura coalition. The chairmen of the NasDem (Surya Paloh) and PKB (Muhaimin Iskandar) have reportedly confirmed that Kalla will be the running mate.

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Investors were not happy to see the parliamentary election result of Indonesia on Wednesday (09/04). The fragmented outcome implies continued political uncertainty toward the July 2014 presidential election. None of the Indonesian political parties were able to secure a majority in the legislative election, meaning it will be more difficult to pursue a clear and steady political course over the next five years. The PDI-P, which was forecast to secure an impressive victory on the 'Jokowi effect', was unable to record a large victory.

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As the first quarter of 2014 ended last week, it is interesting to take a quick look at which countries were the most popular and unpopular investment targets of international investors in terms of stock trading. Indonesia has been 'hot' so far in 2014, with both its benchmark stock index and the rupiah strengthening considerably. Not far after Indonesia come the indices of Vietnam and Portugal. But the winners of the first quarter were Dubai and Bulgary where the benchmark stock indices gained 32.3 percent and 22.2 percent respectively in Q1-2014.

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On 23 February 2014, Indonesia Investments released the latest edition of its newsletter. This free newsletter, which is sent to our subscribers once per week, contains the most important news stories from Indonesia that have been reported on our website in the last seven days. Most of the topics involve economic matters such as the G20 meeting in Sydney, foreign confidence in Indonesia's capital markets, the Gini ratio, coal royalties, the current account deficit, infrastructure development, and more.

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Indonesian stocks and the country's currency feel the negative impact of the further winding down of the Federal Reserve's bond-buying program (quantitative easing). Yesterday (29/01), it was announced that the Fed will cut the bond-buying program by USD $10 billion to USD $65 billion per month. Among market participants concern emerged about the stability of emerging economies amid the tapering as capital outflows are expected. After opening, the benchmark stock index of Indonesia (IHSG) immediately fell more than 1 percent.

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On Wednesday (29/01), the Federal Reserve (Fed) announced to cut its massive bond-buying program (quantitative easing, QE) by another USD $10 billion after the FOMC meeting, while maintaining interest rates close to zero. Originally, the Fed's QE program, implemented in September 2012, totalled USD $85 billion per month but after the cuts in December 2013 and January 2014, it is now wound down to USD $65 billion per month and if the pace of tapering continues, the program might be over by the end of 2014.

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On Sunday 22 December 2013, Indonesia Investments released its latest newsletter. This free newsletter, which is sent to our subscribers once per week, contains the most important news stories from Indonesia that have been reported on during the last seven days on our website. Most of the topics involve economic matters such as a forecast of the performance of the Jakarta Composite Index, the government's fuel subsidy spending, crude palm oil exports, the initial public listing of Sido Muncul Herbal, and more.

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Various analysts believe that the benchmark stock index of Indonesia (the Jakarta Composite Index or IHSG) can make a good jump in 2014 to the level of between 5,000 to 5,300 points (from 4,182 currently) despite the looming end of the Federal Reserve's quantitative easing program (QE3) which may result in temporary capital outflow from Indonesia's capital markets. The analysts believe that positive internal developments will provide solid support for the IHSG. These developments include the trade balance, rupiah exchange rate and general elections.

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Concerns about the looming end of the Federal Reserve's monthly USD $85 billion stimulus program (known as quantitative easing or QE3) in combination with the deteriorating domestic economy of Indonesia has caused Indonesia's benchmark stock index (IHSG) to plunge 1.95 percent in the first trading session of 13 November 2013. The Indonesian rupiah exchange rate depreciated 0.28 percent to IDR 11,600 according to Bloomberg. These developments happen one day after the decision of Indonesia's central bank to raise the BI rate to 7.50 percent.

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Various factors contributed to the 2.30 percent decline of the Jakarta Composite Index (IHSG) on Tuesday (26/11). The index in fact fell below its support level. What were the main reasons for this weak performance? Firstly, the Indonesian rupiah exchange rate has been depreciating severely and causes concerns among market players. Secondly, most Asian stock indices fell as valuations climbed high and the Japanese Yen strengthened. Thirdly, European stock openings on Tuesday were weak. All these reasons together led to foreign net selling.

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The Jakarta Composite Index (Indonesia's benchmark stock index, abbreviated IHSG) made a positive start on Monday (25/11). Investors were confident amid today's rising indices throughout Asia, brought on by the record breaking Dow Jones Index on Wall Street at the end of last week. However, this market optimism failed to provide a significant boost to the IHSG as the Indonesian rupiah exchange rate continued its downward spiral. The IHSG was up 0.39 percent to 4,334.80 points at the end of Monday's trading day.

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On the last day of the trading week (22/11), Indonesia's benchmark stock index (IHSG) fell 0.19 percent to 4,317.96 points thereby extending its losing streak to three days as investors remain concerned about the looming end - or at least winding down - of the Federal Reserve's monthly USD $85 billion bond buying program known as quantitative easing (QE3). Foreign investors recorded a net sell of IDR 38 billion (USD $3.3 million). The other indices in Asia were mixed. The Hang Seng and Nikkei were up but the Shanghai Composite was down.

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On Thursday's trading day (21/11/13), the Jakarta Composite Index (Indonesia's benchmark stock index, or IHSG) fell 0.56 percent to 4,326.21 points as investors are concerned seeing the result of the latest Federal Open Market Committee (FOMC) meeting, which seems to indicate that the Federal Reserve's monthly USD $85 billion bond-buying program (quantitative easing) will be wound down within a couple of months. The IHSG was also negatively affected by the lower preliminary HSBC Manufacturing PMI of China.

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Amid falling Asian stock indices, Indonesia's benchmark stock index (IHSG) went down 1.08 percent to 4,350.79 points on Wednesday's trading day (20/11). As has become an usual pattern, after one or two days of gain, market participants immediately engage in profit taking the following day. Investors reacted to the OECD's downgrade of its outlook for global economic growth (triggered by slowing growth in emerging markets) and to Indonesia's central bank's higher interest rate (which impacts negatively on the country's economic growth).

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Various factors contributed to the 1.34 percent rise of Indonesia's benchmark stock index (also known as the Jakarta Composite Index or the IHSG) on Monday (18/11) to 4,393.59 points. Firstly, the index was supported by other major Asian stock indices which all benefited from rising indices on Wall Street and in Europe at the end of last week. Secondly, the IHSG felt the positive impact from speculation that the government of China will reform its economy in order to spur economic growth.

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Indonesia's benchmark stock index (IHSG) was not able to continue its rebound. On Friday (15/11), the IHSG fell 0.73 percent to 4,335.45 points amid widespread profit taking. Foreign investors recorded net selling of IDR 193 billion (USD $16.9 million) on today's trading day. Moreover, investors are concerned about the impact of the higher interest rate of the central bank (7.50 percent), particularly on the property and banking sectors in the fourth quarter of 2013.

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Amid negative market sentiments, brought on by domestic factors, Indonesia's benchmark stock index (IHSG) and rupiah exchange rate plunged on Wednesday (13/11). For many investors, in particular foreign investors, Indonesia's central bank's decision to raise the benchmark interest rate (BI rate) by 25 bps to 7.50 percent yesterday (12/11) was reason to engage in stock selling. It was worsened by the continued decline of the rupiah as well as weak Asian stock indices and weak stock openings in Europe.

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Indonesia's Jakarta Composite Index (IHSG) started Tuesday's trading day (12/11) slightly in the red. However, after the central bank of Indonesia (Bank Indonesia) announced to have raised its benchmark interest rate (BI rate) by 25 bps to 7.50 percent, the IHSG quickly plunged. The interest rate hike is considered as a sign that Bank Indonesia is still concerned about the nation's macroeconomy, particularly Indonesia high inflation (8.32 percent yoy in October 2013). The index fell 1.38 percent to 4,380.64 points.

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The Jakarta Composite index (Indonesia's benchmark stock index or IHSG) fell on Monday (11/11) amid mixed Asian markets. Not even positive finishes on Wall Street last Friday (08/11) were able to support the IHSG. Most investors seem to be waiting for results of Bank Indonesia's Board of Governor's Meeting which is scheduled for Tuesday (12/11). This meeting will provide answers about the central bank's view of the domestic economy and whether it thinks another adjustement of the BI rate is necessary.

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