The Composite Stock Price Index (IHSG) of the Indonesia Stock Exchange (IDX) closed higher on Tuesday (24/9) afternoon as market players responded positively to dovish comments from officials of the United States (US) Central Bank, The Federal Reserve (The Fed). IHSG closed up 2.76 points or 0.04% to 7,778.49. Meanwhile, the group of 45 leading stocks or the LQ45 index rose 0.15 points or 0.02% to 985.41.
“IHSG and the Asian regional stock exchange moved up, the market responded to the dovish comments of the US Fed officials and also the monetary policy plan of the People’s Bank of China (PBOC),” said the Pilarmas Investindo Sekuritas Research Team in its study, in Jakarta, Tuesday.
Market players are focused on the development of the Fed’s benchmark interest rate. It is known that Fed officials Raphael Bostic, Neel Kashkari, and Austan Goolsbee expressed their support for further interest rate cuts in the remainder of this year.
Furthermore, the market also responded to the policy of the People’s Bank of China (PBoC) which announced its monetary policy steps. PBoC Governor Pan Gongsheng said it would cut the reserve requirement ratio by 50 basis points (bps) before the year ends, without giving a specific timetable.
In addition, he announced that the seven-day repo rate would be reduced by 20 bps to 1.5%. He also provided a policy for reducing down payments for second homes and long-term financing worth 1 trillion yuan. The market considered the PBoC policy as a series of stimuli to boost the Chinese economy.
Opening lower, the JCI moved into negative territory until the close of the first session of stock trading. In the second session, the JCI was comfortable in the green zone until the close of stock trading.
Also read: IHSG Continues to Weaken, Impact of the American Financial Crisis
Based on the IDX-IC Sectoral Index, seven sectors increased with energy the highest at 1.12% followed by transportation and logistics and infrastructure which rose by 0.89% and 0.52% respectively. Meanwhile, four sectors were corrected, namely technology which fell the deepest at minus 1.03% followed by non-prime consumer goods and industry which each fell by minus 0.69% and minus 0.32%.
The stocks that experienced the biggest gains were PART, IOTF, PTRO, MEJA, and AYLS. Meanwhile, the stocks that experienced the biggest declines were LABA, EMDE, NASI, PMMP, and SMLE.
The frequency of stock trading was recorded at 1,403,887 transactions. The shares traded were 22.00 billion shares worth Rp16.58 trillion. The price of 249 shares rose, 332 shares fell, and 215 did not move.
The regional Asian stock exchanges this afternoon included the Nikkei Index strengthening by 216.70 points or 0.57% to 37,940.60, the Hang Seng Index strengthening by 753.45 points or 4.13% to 19,000.56, the Shanghai Index strengthening by 114.20 points or 4.15% to 2,863.12, and the Straits Times Index weakening by 15.80 points or 0.43% to 3,622.73. (Ant/Z-2)
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