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IDX Composite gains 0.39% on positive US inflation data

The IDX Composite closed 0.39 percent higher on Thursday after better-than-expected US core inflation data and a surprise interest rate cut by Bank Indonesia.

News Desk (The Jakarta Post)
Jakarta
Thu, January 16, 2025

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IDX Composite gains 0.39% on positive US inflation data A screen at the Indonesia Stock Exchange (IDX) in Jakarta shows stock quotes on Jan. 2, 2025. The IDX Composite (IHSG) closed 0.39 percent higher at 7,107.52 on Jan. 16, 2025. (Antara Foto/Hafidz Mubarak A)

T

he Indonesia Stock Exchange (IDX) Composite index closed higher on Thursday, returning to the 7,000 level after rising by 0.39 percent to close at 7,107.52.

The market’s upward movement was driven by positive sentiment from the release of United States inflation data.

In total, 289 stocks advanced, 302 declined and 209 remained unchanged. The total trading volume was 16.7 billion shares, valued at Rp 13.2 trillion (US$805.4 million).

Among the 11 sectoral indices, six experienced growth. The property and real estate sector led the charge, climbing 0.95 percent. It was followed by energy and finance, which gained 0.71 percent and 0.64 percent, respectively.

On the other hand, the non-primary consumer goods sector posted the largest drop, falling by 1.99 percent. The healthcare sector decreased by 0.84 percent, while the technology sector lost 0.47 percent.

The LQ45 index also saw a positive performance. The top gainers on the LQ45 were PT Unilever Indonesia (UNVR), which posted the largest increase after rising by 2.88 percent. It was followed by PT Bank Mandiri (BMRI), which rose by 2.17 percent, and PT Bank Negara Indonesia (BBNI), which gained 2.04 percent.

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On the downside, PT Merdeka Battery Materials (MBMA) led the losses, falling by 3.21 percent, followed by PT Sumber Alfaria Trijaya (AMRT), which dropped 2.81 percent, and PT Essa Industries Indonesia (ESSA), which declined by 2.31 percent.

The market’s positive performance was largely attributed to US core inflation data, which came in below expectations, and a surprise 25 basis point interest rate cut by Bank Indonesia (BI).

BNI Sekuritas retail and research head Fanny Suherman said the IDX Composite had the potential to test the 7,120-resistance level, with support expected in the 7,000-7,020 range. She also said that it was influenced by US core inflation data, which came in below expectations.

"[This was] in addition to Bank Indonesia's surprising decision to cut interest rates by 25 basis points," she said on Thursday, as quoted by rri.co.id.

The US inflation report revealed a year-on-year increase of 2.9 percent, in line with expectations, while core inflation unexpectedly softened to 3.2 percent, missing the forecast of 3.3 percent.

This contributed to a rally in the US stock markets, with the Dow Jones Industrial Average surging 1.65 percent, the S&P 500 climbing 1.83 percent and the Nasdaq Composite soaring 2.45 percent.

"The market received a boost from impressive earnings reports from several major US banks, such as JP Morgan and Goldman Sachs, and US inflation data that was lower than expected," read Samuel Sekuritas's report on Thursday, as quoted by tempo.co.

Meanwhile, Asia-Pacific stock markets were mixed, with investors also focusing on the Reuters Tankan survey regarding Japan's business conditions for January 2025, which was released on Wednesday.

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