The Jakarta Post
The Jakarta Composite Index (JCI) declined by 1.5 percent to close at 4,525.91 points on the first trading day of 2016, while the rupiah in the spot market depreciated by 95 points to 13,925 per US dollar.
Universal Broker Indonesia head of research Satrio Utomo said major Asian stock markets moved into negative territory, which eventually pushed local traders to take a selling position on Monday.
"During the trading hours, the JCI strengthened, but then retreated to the negative area after Chinese stock markets declined," he said as quoted by the Antara news agency on Monday.
However, he predicted, the JCI would move back into positive territory in the mid-term, as foreign investors might want to buy into the 'January Effect' phenomenon'with stocks prices typically increasing in January more than in any other month.
HD Capital analyst Yuganur Wijanarko said despite JCI's poor performance in initial 2016 trading, some investors on Monday showed optimism by accumulating blue chips and second liners.
On Monday, the Indonesian Stock Exchange (IDX) recorded 179,722 transactions with a volume of 2.1 billion shares valued at Rp 2.8 trillion (US$201.1 million).
Foreign investors scored a net buy of Rp 84.2 billion (US$ 6 million). As many as 77 stocks increased, while 94 weakened and 218 remained unchanged.
In regional markets, the Hang Seng Index dropped 2.7 percent, the Nikkei Index weakened 3.1 percent, and the Straits Times Index was down 1.6 percent.
Monex Investindo Futures head of research Ariston Tjendra said the US dollar appreciated against most currencies of the world, including the rupiah, due to different monetary policies among developed countries.
"[The] US dollar index strengthened, as the US central bank will raise its benchmark interest rate further in 2016, while the European Central Bank [ECB] and Bank of Japan [BOJ] chose to maintain their loose monetary policy," he said. (ags)