Indonesian Stocks Edge Lower After Bank Indonesia Maintains Benchmark Rates Unchanged

Informasi Pasar Modal Hari Ini

• Jakarta composite closed at red territory after breaking through psychological level of 7,000 in early trade.
• Indonesia’s central bank kept interest rates unchanged at record lows on Thursday, as expected, citing a need to keep financial markets stable, anchor inflation and support the economy’s recovery from the COVID-19 pandemic.
• Companies increased their capital expenditure budgets in 2022 to increase their footprint, meet greater demand and beat their competitors.
• Shares in Asia and Europe rose in Thursday trade with investors digesting the Federal Reserve hiking its benchmark interest rate for the first time since 2018 and signaling six more hikes this year.
• Oil prices climbed on Thursday after the International Energy Agency said markets could lose three million barrels per day of Russian crude and refined products from April.

Jakarta composite slipped 28.01 points (-0.401%) to 6,964.385. LQ45 declined 0.77% to 1,005.819. There were 21.967 billion shares traded worth of Rp15.055 trillion, including transaction of Rp1.856 trillion in negotiation market. 274 shares rose while 250 declined and 156 unchanged. Foreign investors purchased a net Rp708.13 billion in regular market only.

On currency, according to JISDOR Thursday afternoon, rupiah climbed 21 points (+0.15%) to 14,290. Spot rate added 10 points (+0.07%) to 14,300.

Indonesia’s central bank kept interest rates unchanged at record lows on Thursday, as expected, citing a need to keep financial markets stable, anchor inflation and support the economy’s recovery from the COVID-19 pandemic. The benchmark 7-day reverse repurchase rate remain at 3.50%, overnight Deposit Facility rate and Lending Facility rate steady at 2.75% and 4.25%, respectively.

Indonesia, the world’s largest producer of palm oil, is ironically in the midst of a cooking oil shortage. Despite a government-imposed price cap, retail prices for the product have nearly doubled in recent weeks. It has come to a point where Indonesians are reportedly rushing to get their hands on government-subsidized cooking oil as they disappear from traditional markets and supermarkets.

The government’s decision to keep absorbing price shocks and subsidize items like cooking oil and gasoline kept inflation last month at the low end of the 2%-4% target. Monetary authorities have also begun draining excess liquidity by raising banks’ reserve ratio by 150 basis points to 5% this month.

Corporate news

Companies increased their capital expenditure budgets in 2022 to increase their footprint, meet greater demand and beat their competitors. TAPG budgeted Rp572 billion for business expansion, PTBA prepared Rp2.9 trillion to increase production and penetrate downstream sector, while DOID allocated US$200 million, aiming for US$1.5 billion revenue.

Global markets

• Shares in Asia and Europe rose in Thursday trade with investors digesting the Federal Reserve hiking its benchmark interest rate for the first time since 2018 and signaling six more hikes this year.
• Hong Kong’s Hang Seng index led gains among the region’s major markets, surging 5.79% by the afternoon, adding to Wednesday’s 9% gains and erasing heavy losses from earlier in the week.
• The two-year U.S. Treasury yield hit 2.002% after the Fed decision before easing to 1.9159% in Tokyo trading, while the 10-year yield jumped to 2.2460% and then eased to 2.1403%. Both overnight levels were the highest since May 2019.
• The Fed increased rates by an as-expected quarter point and telegraphed equivalent hikes at every meeting for the remainder of this year to aggressively stamp out inflation.
• Investors are now focused on central bank action in Europe, with the Bank of England widely expected to raise its key rate by another 25 basis points to 0.75%. In addition, the European Central Bank will hold an annual conference at which President Christine Lagarde, chief economist Philip Lande and board member Isabel Schnabel will all speak.

Commodities

Oil prices climbed on Thursday after the International Energy Agency said markets could lose three million barrels per day of Russian crude and refined products from April. Prices had sagged in the previous session on news that oil inventories in the United States climbed by 4.3 million barrels in the week to March 11 to 415.9 million barrels, according to the U.S. Energy Information Administration, surpassing analysts’ expectations for a decline of 1.4 million barrels.

Brent crude futures climbed $3.53 or 3.6% to 101.55 per barrel while West Texas Intermediate crude futures, the U.S. oil benchmark, added $3.19 or 3.34% to trade at $98.23 per barrel.

In China markets Thursday, Iron ore futures open more than 4% higher, steel rebar, hot-rolled coils, and wire futures are up 2.2%. Low-sulfur fuel oil down more than 2%, crude oil futures drop 1.22% to 613 yuan per barrel. Nickel opens down 1.16% to 220,740 yuan per ton

Informasi Pasar Modal Hari Ini

Major index this afternoon:

STOXX 50.. 3,902.66 (+0.33%)
CAC 40.. 6,615.69 (+0.41%)
DAX.. 14,461.49 (+0.14%)
FTSE.. 7,313.19 (+0.29%)

NIKKEI.. 26,652.89 (+3.46%)
HSI.. 21,501.23 (+7.04%)
SHCOMP.. 3,215.04 (+1.40%
TAIEX.. 17,448.22 (+3%)
KOSPI.. 2,694.51 (+1.33%)
S&P/ASX 200.. 7,250.80 (+1.05%)
SENSEX.. 57,994.75 (+2.07%)
STI.. 3,319.13 (+0.86%)

DOW FUT.. 33,960.00 (+0.02%)
S&P FUT.. 4,348.50 (-0.02%)
NASDAQ FUT.. 13,950.00 (-0.02%)