RTTNews - One day after ending the two-day losing streak that had cost it just five points or 0.26 percent in the process, the Indonesian stock market turned right back to the downside again on Tuesday. The Jakarta Composite Index plummeted through support at 1,890 points from its highest point so far for 2009, but now analysts are predicting that the market could recover some of those losses at the opening of trade on Wednesday.
The global forecast for the Asian markets is cautiously optimistic, although the positive sentiment could be damaged by the test-firing of another missile on Wednesday morning by North Korea. The markets get a boost from better than expected economic data out of the United States, and retailers also are forecast to trade higher. The European markets finished mostly higher and the U.S. markets ended sharply higher - and the Asian bourses are also tipped to trade in the green.
The JCI finished sharply lower on Tuesday, as the financials and resource stocks finished under heavy selling pressure.
For the day, the index plummeted 33.38 points or 1.77 percent to close at 1,857.59 after trading between 1,852.02 and 1,905.91. Leading the decliners, Bumi Resources dropped 6.5 percent and Aneka Tambang fell 2.55 percent.
The lead from Wall Street is broadly positive as stocks staged a substantial rally over the course of the trading day on Tuesday after seeing some initial weakness, snapping a four-day losing streak. The major averages finished near their best levels of the day, bolstered by some positive news on the health of the U.S. consumer.
The Conference Board's reading on consumer confidence for May improved by far more than expected, reaching its highest level since September. The data generated some optimism about the outlook for consumer spending, which accounts for nearly two-thirds of economic activity. The consumer confidence figure helped to bolster some of the day's risk appetite, as reflected by the surge in equities following the release of the report.
Earlier in the day, disappointing housing price data contributed to the initial weakness. Traders largely shrugged off the data, however, citing the lagging nature of the numbers and choosing to focus on the encouraging consumer confidence data.
Retail stocks enjoyed a considerable run-up on the day, benefiting from the better than expected consumer confidence data. The S&P Retail Index closed up 4 percent, although it remains well off the seven-month highs that it set earlier this month.
The major averages moved roughly sideways in the second half of the day, holding onto strong gains. The Dow closed up 196.17 points or 2.4 percent at 8,473.49, the NASDAQ rose 58.42 points or 3.5 percent to 1,750.43 and the S&P 500 closed up 23.33 points or 2.6 percent at 910.33.
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