A

nalysts have warned that profit-taking may occur next week following the Jakarta Composite Index'€™s (JCI) steep rally on Friday.

The JCI, the benchmark of the Indonesia Stock Exchange (IDX), soared by 2.85 percent compared with Thursday'€™s close and ended the day on Friday at 4,798, a level unseen since August last year.

NH Korindo Securities Indonesia head of research Reza Priyambada expressed pessimism that the bullish trend would continue next week because the market often rushed to take profits if the
index spiked.

'€œIt has usually been apparent that profit taking follows leaps in the index,'€ he said over the phone on Friday. '€œThat makes it difficult for our market to maintain its upward trend'€.

He projected the index would move at around 4,810 to 4,825 should positive sentiment persist and at between 4,750 and 4,735 if the opposite happened.

Reza said global sentiment would have a bigger effect on the bourse next week as domestic economic-indicator data had all been released throughout this week.

Capital Asset Management analyst Desmon Silitonga voiced similar concerns, saying the strengthening move needed to be treated with caution.

'€œThe index'€™s move, which is up by almost 5 percent in just three days, is too fast,'€ he said, adding that the JCI should have moved at levels between 4,500 and 4,600, in line with its short-term target.

Desmon stated that corrections would possibly happen in the following week, considering global economic turmoil had not yet eased.

China'€™s benchmark Shanghai Composite Index slid by 0.63 percent on Friday while Japan'€™s Nikkei 225 fell by 1.32 percent, according to Bloomberg data.

However, the Dow Jones Industrial Average and the S&P 500 Index, in the US, moved up 0.49 percent and 0.15 percent, respectively, as of Thursday afternoon.

Investa Saran Mandiri analyst Hans Kwee said the persistently gloomy economy in China, negative interest rate applied by Japan'€™s central bank and signs of a delayed interest rate hike by the US Federal Reserve had triggered capital outflows from those countries to emerging markets, such
as Indonesia.

The bond market had seen the foreign capital inflow first and the stock market would soon follow,
he said.

'€œBetter-than-expected financial performances by several listed companies have triggered more stock purchases,'€ he said, adding that Indonesia'€™s economic growth data release had also cheered the market.

The Central Statistics Agency (BPS) on Friday announced that Southeast Asia'€™s largest economy expanded by 5.04 percent year-on-year (yoy) in last year'€™s fourth quarter, higher than the 4.74 percent in the third quarter, making full-year growth of 4.79 percent yoy.

The encouraging growth figures showed that Indonesia'€™s economy was not as bad as the market thought, Hans said, although he hoped the market would remain cautious in its profit-taking risks after the speedy rally.

Meanwhile, Koneksi Kapital head of research Alfred Nainggolan also predicted that short-term corrections would happen in the market in the following week although it remained more in a bullish mood.

He said the index had the chance to pass the 4,800 level, mainly supported by both domestic economic sentiment and investors, who had helped to offset foreign net sales so far this year.