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JCI drops 2.29 percent on Wednesday closing
The Jakarta Composite Index (JCI) dropped by 2
Change Size
The Jakarta Composite Index (JCI) dropped by 2.29 percent or 99.61 points to 4,244.43 at the close, responding to China's preliminary Purchasing Managers' Index (PMI) that touched the lowest level in more than six years.
The data confirmed that the manufacturing sector in the biggest economy in Asia contracted. China is the main trading partner for Indonesia, worth US$48.2 billion in 2014, according to National Statistic Agency (BPS) data.
'Bank Indonesia predicted that economic growth in 2015 would be around 4.7 to 5.1 percent, while the ADB [Asian Development Bank] projected growth at 4.9 percent, compared to the previous projection of 5.5 percent,' analyst at LBP Enterprise Lucky Bayu Purnomo said as quoted by Antara news agency.
China's manufacturing data, he added, was worrisome for Asia Pacific economies. The Caixin Media and Markit Economics PMI were at 47 for September, below the final reading of 47.3 in the previous month.
Foreign investors recorded net sells of Rp 690 billion (US$5 million) in Wednesday's trading, from the total daily transaction of Rp 4.79 trillion. Around 61 percent of shares listed on the Indonesia Stock Exchange (IDX) plunged.
The correction also happened in Asia Pacific equities markets. Japan's Nikkei 225 fell by 1.96 percent, Hong Kong's Hang Seng Index was down 2.29 percent and South Korea's Kospi dropped 1.89 percent.
Head of research at MNC Securities Edwin Sebayang added that rupiah depreciation made the sentiment in the equity market worse. A weakening rupiah may curb the listed companies' performance in the second half of the year.
'As for now, the rupiah is still under pressure, which is probably suppressing the listed companies' performance,' he said.
The rupiah depreciated further, by 0.65 percent, to Rp 14,646 per US dollar on Wednesday afternoon, compared to Tuesday afternoon's position at Rp 14,486 per US dollar. (ags/dk)
