Until when will foreign funds continue to leave the Indonesian stock market? This is what the analyst said

ILLUSTRATION. Journalists take pictures of the screen of stock trading movements on the Indonesia Stock Exchange (BEI), South Jakarta, Thursday (10/9/2020). The Composite Stock Price Index or JCI closed in the red zone at the end of trading this week, namely at the level of 4,891.46 or down 257.9

Reporter: Akhmad Suryahadi | Editor: I knew Laoli

KONTAN.CO.ID – JAKARTA. Foreign funds continue to leave the Indonesian stock market. Since the beginning of the year (year-to-date), total net sell foreigners in all markets reached Rp. 39.71 trillion while in the regular market it reached Rp. 56.25 trillion.

This week, the number net sell foreigners are also quite large, reaching Rp. 3.84 trillion in all markets. So, until when will foreign investors continue to sell off the Indonesian stock market?

President Director of the CSA Institute, Aria Santoso, assessed that in the short term, foreign funds would still go in and out, as well as the periodic portfolio allocation.

Meanwhile, Aria assessed that there is a potential for incoming funds (inflow) in October after the availability of data on issuers’ performance in the third quarter is projected to be better than the second quarter.

Also Read: Foreign funds outflowing reached Rp. 56.25 trillion since the beginning of the year, this is the trigger

“Furthermore, foreign investors will also assess various strategies from the government to overcome the economic recovery from various public policies that have an impact on the potential of the Indonesian economy,” Aria told Kontan.co.id, Sunday (20/9).

Amid the massive outflows of foreign funds, domestic investors can adjust their respective investment risk profiles.

Investors can focus on companies that have good fundamentals and can survive in the long term and buy at low prices.

Phillip Sekuritas analyst Anugerah Zamzami Nasr projects that it is possible that foreigners will re-enter the Indonesian stock market when the Covid-19 case has been resolved. Meanwhile, the number of daily new cases is still quite high.

In addition, the economic recovery that has started to rise and the gross domestic product (PSB) which returns to its potential growth will also invite investor funds to return to the stock market.