Pulled by Omicron Driven by Profit Season, where is the JCI going?

Jakarta, CNBC Indonesia – The performance of the Composite Stock Price Index (JCI) last week was somewhat disappointing. Where the JCI fell more than 1% in line with the increasing volatility of the global stock market.

Last week, the Indonesia’s benchmark index fell 1.2% on a point-to-point. However, on Friday (29/1/2022) trading yesterday, the JCI closed up 0.52% to 6,645.51. JCI is again moving away from the level all time high (ATH) which was inscribed again on January 21, 2022.

During the week, the transaction value of the JCI reached Rp 60.4 trillion. Foreign investors recorded a net buy of almost Rp 74 billion in the regular market and Rp 186 billion in all markets.

On a daily basis, the JCI actually strengthened more last week, where the JCI was only corrected for two days, namely Monday and Tuesday. However, the correction that occurred in trading early last week was quite severe, which was corrected by more than 1%.

Rising global stock market volatility also weighed on the JCI’s performance, with investors still worried about the potential tightening of monetary policy by the United States (US) central bank.

Last week, the US central bank (Federal Reserve / The Fed) held a policy-making meeting (Federal Open Market Committee / FOMC) which lasted for two days from Tuesday to Wednesday US time.

On Wednesday afternoon US time or early Thursday Indonesian time, the Fed announced the results of its meeting, in which the world’s most influential central bank agreed to raise its benchmark interest rate in March.

This was done by the Fed to curb rising inflation, where inflation from the consumer side (Consumer Price Index/CPI) in December 2021 was already at 7%. Global investors also remain wary of the Fed’s increasingly hawkish going forward.

Meanwhile, during the last week, the rupiah recorded another correction, amidst the strength of the United States (US) dollar.

Launching from Refinitiv last week, the rupiah was corrected by 0.35% point-to-point. On Friday’s trading (29/1/2022), the rupiah closed tending to stagnate at the level of Rp. 14,385/US$.

The weakening is getting bigger, where in the previous week the rupiah also closed down 0.28% in front of the currency pair greenback.

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