Capital inflows helped the Jakarta Composite Index (JCI) reach another new historical level on Friday, defying bearish regional indices.
The JCI was closed at 4,609.79 on Friday, a 0.46 percent increase compared to a day earlier and a 6.79 percent increase in the year-to-date.
Thailand’s SET slipped 0.34 percent on Friday, along with Malaysia’s 0.18 percent drop, Singapore’s 0.22 percent decline and Japan’s Nikkei 225 1.18 percent fall.
As many as 8.22 billion shares exchanged hands in 155,523 transactions worth Rp 5.77 trillion in Jakarta on Friday. The trading was more active compared to the daily average volume of 5.06 billion shares, the daily transaction average of 151,629 and value of Rp 5.19 trillion, figures from the Indonesia Stock Exchange (IDX) showed.
“Many foreign investors purchased stocks of the big cap companies, which are related to the country’s economic indicators. The inflows show Indonesia’s economic prospects and particularly companies’ financial performance,” Andrew Argado of PT eTrading Securities said on Friday.
Foreign investors pumped in Rp 392.7 billion on Friday, pushing the year-to-date net buy to Rp 11.17 trillion. According to figures from the Indonesian Central Securities Depository (KSEI), foreign investors held 54 percent of Indonesian stocks as of January. However, the bourse’s data showed domestic investors remained dominant in terms of trading value by about 59 percent in the year to date.
“Inflows keep entering Indonesian stock and bond markets. Foreign net buy in the stock market reached Rp 5.1 trillion from early February to Feb. 14. Meanwhile, foreign ownership in government bonds reached Rp 276 trillion,” securities PT Henan Putihrai said in a research note.
The yield on Indonesia’s 5.625 percent notes maturing in May 2023 inched up by two basis points on Friday, according to figures from the Inter Dealer Market Association, quoted by Bloomberg.
All sectors ended in the green zone on Friday, except mining stocks. Consumer and banking stocks dominated the top 10 movers on Friday, led by shares in PT Telekomunikasi Indonesia.
Stocks of four companies in the consumer sector in the top 10 list, namely consumer goods giant PT Unilever Indonesia, pharmaceutical firm PT Tempo Scan Pacific, food manufacturer PT Indofood Sukses Makmur and cigarette maker PT Gudang Garam, showed that investors poured money into a sector that was driven by rising consumption on the back of healthy gross domestic product (GDP) growth in Indonesia.
Another cigarette maker, PT HM Sampoerna, whose shares are rarely traded, became the biggest company by market capitalization, taking over the position previously held by diversified conglomerate PT Astra
Three big banks, PT Bank Rakyat Indonesia, PT Bank Negara Indonesia and PT Bank Central Asia, were also on the top 10 daily movers list on Friday.
Meanwhile, shares in troubled coal miner PT Bumi Resources led the top laggard list with a 6.59 percent drop to Rp 850 apiece on Friday although it saw a 26 percent increase a day earlier.
Analysts expected the JCI to reach the 5,000 level this year, increasing by about 15 percent compared to a closing of 4,316.69 last year.
“We see that a 5,000 target is too aggressive. If we look at the growth of 50 big companies at the range of 15 to 20 percent, the index will be at 4,772. However, if we see the good result of the companies’ first half financial reports, there can be a revision of the target,” Andrew of eTrading said.