The winning streak has hit three sessions now for the Indonesian stock market, which has put on nearly 80 points or 6 percent in the process. The Jakarta Composite Index came within a whisker of closing above resistance at 1,500 points, and now analysts predict that the market will break through that level at the opening of trade on Friday.
The global forecast for the Asian markets continues to be strong, although some profit taking may set in as several bourses already have seen major gains this week. The G-20 economic summit in London has generated considerable positive momentum, fueling optimism that the global economy may finally be starting to recover. The European markets finished sharply higher, as did the U.S. markets - and the Asian bourses are predicted to follow suit.
The JCI finished sharply higher on Thursday, powered by gains among the financial stocks. For the day, the index jumped 37.99 points or 2.6 percent to close at 1,499.79. Volume was 3.6 billion shares worth 3 trillion rupiah.
Among the gainers, Bank Indonesia added 7.7 percent, while Bank Mandiri rose 6.7 percent and Bank Danamon was up 4 percent.
The lead from Wall Street remains upbeat as stocks showed a strong upward move during trading on Thursday, as investors reacted well to mixed economic news and liked what they heard from the G-20 summit in London. The continued advance also reflected some optimism about stabilization in the economy.
Before the start of trading, the Labor Department said that initial jobless claims in the week ended March 28th unexpectedly rose to 669,000 from the previous week's revised figure of 657,000. With the increase, jobless claims rose to a new twenty-six year high.
Additionally, a report from the Commerce Department showing that factory orders rose 1.8 percent in February added to recent signs of stabilization in the economy, although the report also showed a notable downward revision to the data for January.
Meanwhile, traders were also keeping a close on the Group of 20 Summit in London, with the world leaders assembled at the meeting pledging to do whatever is necessary to end the economic crisis. President Barack Obama called the agreements reached by leaders a turning point in our pursuit of global economic recovery.
However, the president cautioned that while the reforms agreed to are necessary, they might not be sufficient. In order to ensure that a stable recovery takes hold, the G-20 will meet again in the fall, Obama announced. While noting that it is important that nations agree on an action plan, the president said individual actions remain just as important.
While the major averages gave back some ground going into the close, they still ended the session firmly positive. The Dow closed up 216.48 points or 2.8 percent at 7,978.08, the NASDAQ closed up 51.03 points or 3.3 percent at 1,602.63 and the S&P 500 closed up 23.30 points or 2.9 percent at 834.38. With the gains, the Dow and the S&P 500 ended the session at their best closing levels in nearly two months, while the tech-heavy Nasdaq set a nearly three-month closing high.
In economic news, Indonesia is on Friday set to announce its decision on interest rates. The central bank is widely tipped to leave the rate on hold at 7.75 percent.
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