Lower Open Anticipated For Indonesia Stock Market

The Indonesia stock market has moved lower in back-to-back trading days, sinking almost 100 points or 1.6 percent along the way. The Jakarta Composite Index now rests just above the 5,980-point plateau and it may open in the red again on Thursday.

The global forecast for the Asian markets is flat to lower, thanks mainly to sinking crude oil prices. The European markets were barely down and the U.S. bourses were mixed and little changed and the Asian markets figure to split the difference.

The JCI finished modestly lower on Wednesday following losses from the financial and cement companies, while the resource stocks were mixed.

For the day, the index fell 32.82 points or 0.55 percent to finish at 5,979.22 after trading between 5,947.62 and 6,013.04.

Among the actives, Bank Danamon Indonesia tanked 2.76 percent, while Bank CIMB Niaga skidded 1.66 percent, Bank Negara Indonesia lost 1.93 percent, Bank Central Asia shed 0.91 percent, Bank Mandiri retreated 1.30 percent, Bank Rakyat Indonesia weakened 1.85 percent, Indosat added 0.41 percent, Indocement declined 1.66 percent, Semen Indonesia dropped 0.87 percent, United Tractors surrendered 2.23 percent, Astra International plummeted 3.47 percent, Astra Agro Lestari tumbled 2.32 percent, Aneka Tambang jumped 1.97 percent, Vale Indonesia climbed 1.45 percent, Timah spiked 2.22 percent, Bumi Resources sank 1.72 percent and Indofood Suskes was unchanged.

The lead from Wall Street offers little clarity as stocks opened higher on Wednesday but then cooled and hugged the unchanged line, eventually finishing mixed and flat.

The Dow added 44.44 points or 0.13 percent to finish at 34,993.23, while the NASDAQ lost 32.70 points or 0.22 percent to end at 14,644.95 and the S&P 500 rose 5.09 points or 0.12 percent to close at 4,374.30.

Stocks moved to the upside early in the session amid a positive reaction to Federal Reserve Chair Jerome Powell’s remarks before the House Financial Services Committee, which suggested the central bank is not likely to begin tightening monetary policy anytime soon.

Later in the day, the Federal Reserve released its Beige Book, a compilation of anecdotal evidence on economic conditions in each of the twelve Fed districts. The Beige Book noted the U.S. economy strengthened from late May to early July, with the pace of growth described as moderate to robust.

On the earnings front, financial giant Citigroup (C) reported better than expected Q2 earnings, while Delta Air Lines (DAL) reported a narrower than expected Q2 loss on revenues that exceeded estimates. Bank of America (BAC) reported Q2 earnings that beat expectations but on weaker than expected revenues.

Crude oil futures settled lower on Wednesday, weighed down by data showing a drop in gasoline demand. Data showing a drop in China’s first-half crude imports also weighed on oil prices. West Texas Intermediate Crude oil futures for August tumbled $2.12 or 2.8 percent at $73.13 a barrel.

Closer to home, Indonesia will release June figures for imports, exports and trade balance later today. Imports are expected to surge 51.35 percent, down from 68.68 percent in May. Exports care called higher by 49.9 percent on year, slowing from 58.76 percent in the previous month. The trade balance is expected to show a surplus of $2.23 billion, down from $2.37 billion a month earlier.