RTTNews - The winning streak has reached four sessions for the Indonesian stock market, which had collected nearly 110 points or 5 percent on its way to a fresh 12-month closing high. The Jakarta Composite Index closed above the 2,230-point plateau, although investors are bracing for a downside correction at the opening of trade on Wednesday, following the rest of the region to the downside.
The global forecast for the Asian markets is finally downbeat and could signal the end of several lengthy winning streaks in the region. Weakness among the commodity stocks is expected to weight heavily, while steel producers and technology shares could also ease on profit taking. The European markets ended firmly in the red and the U.S. markets also were mostly lower, and the Asian markets also are expected to move to the downside.
The JCI finished sharply higher on Tuesday, thanks to significant gains among the commodities.
For the day, the index added 28.00 points or 1.27 percent to close at 2,237.17 after trading between 2,201.19 and 2,240.64. Volume was 8.56 billion shares worth 5.67 trillion rupiah. There were 153 gainers and 57 decliners, with 74 stocks finishing unchanged.
Among the gainers, Indo Tambangraya rose 7.5 percent, while Sampoerna Agro gained 5.3 percent, Bumi Resources surged 5.8 percent, Energi Mega Persada gained 4.4 percent, Tambangraya Mega jumped 7.5 percent, Adaro Energy added 1.6 percent, Telekomunikasi Indonesia gained 1.7 percent, Indofood Sukses Makmur was up 4.6 percent and Bakrie Sumatera Plantations rose 2.8 percent.
The lead from Wall Street is mildly negative as stocks closed Tuesday's session on a mixed note in reaction to the day's varied earnings and economic reports following a choppy trading session. The major averages closed on opposite sides of the unchanged mark, with the tech-heavy NASDAQ posting a modest gain.
On the economic front, consumer confidence deteriorated by more than expected in the month of July, according to a report released by the Conference Board this morning. The decrease reflected less favorable assessments of both current conditions and the near-term outlook. The Conference Board said that its consumer confidence index fell to 46.6 in July from an unrevised 49.3 in June. Economists had been expecting a much more modest decline by the index to a reading of about 49.0.
Also, the Standard and Poor's /Case-Shiller 20-City Composite Home Price Index fell at an annual rate of 17.1 percent in May compared to the 18.1 percent decrease reported for April. Economists had expected the report to show that prices fell 17.9 percent year-over-year. On a monthly basis, S&P said that 13 of the 20 metro areas reported positive returns, contributing to the first monthly increase by the 20-city composite since the summer of 2006. The 20-city composite index rose 0.5 percent for the month.
In earnings news, Valero Energy (VLO), Amgen (AMGN) and Manitowoc (MTW) reported earnings that beat analyst estimates. On the other hand, Office Depot (ODP) fell well short of analyst forecasts. Meanwhile, IBM Corp. (IBM) announced that it has entered into a definitive agreement to acquire SPSS Inc. (SPSS). The all-cash transaction has a price of $50 per share, resulting in a total cash consideration of approximately $1.2 billion.
The major averages saw further choppy movement to close out another low volume session. While the NASDAQ closed up by 7.62 points or 0.4 percent at 1,975.51, the Dow fell by 11.79 points or 0.1 percent to 9,096.72 and the S&P 500 slipped by 2.56 points or 0.3 percent to 979.62.
In economic news, Indonesia's vice president-designate Boediono said on Tuesday that the government is aiming for a growth of 7 percent in the next five years. Speaking in Singapore, he said the economy is expected to grow 4 percent this year and may expand 5 percent in the next year. Moreover, he said his country has passed the worst of the crisis and some light is visible at the end of the tunnel.
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