The Moneymarket
Bank Indonesia and the Government of RI were certainly
expecting performance of Rupiah and IHSG as reflected in IHSG index by end of
year could be improved. Evidently Rupiah was moving positively, or
strengthening by 75 points on Fridays morning (21/12) after undergoing
significant pressures on the day before.
Rupiah value at inter bank transaction in Jakarta on Friday afternoon strengthened
by 75 points to become Rp 9,645 against the previous position of Rp 9,720 per
USD. Analysts reckoned Rupiah again in positive area Bank Indonesia was reckoned
to make intervention after heavy pressures on rupiah.
Rupiah was still safeguarded by BI as the course tend to nose down
following increased demand for USD. Rupiah was also overshadowed by negative
sentiment by BI’s projection that benchmark interest rate (BI rate) would
resists all low 5.75% in 2013 with inflation below 5%. The condition was
different from The Fed’s rate which was predicted to increase. The impact was
that this sentiment strengthened USD value, so Rupiah was depreciated.
On the other hand rumors breezed out that shares value in Indonesia were
high enough compared to shares in Europe which was rated attractive due to
sentiments from friction in the Euro zone and the case of Greece which signaled
shift of fund.
Just a day before (20/12) Rupiah exchange rate value against USD
weakened to the position of Rp 9,720 per USD compared to the position during previous
closing session of Rp 9,660 per USD Rupiah on that day moving to strengthen by
15 points stimulated by solution of Greece debt crisis.
In the post release period of Germany’s statement which exceeded expectations,
and increasing optimism of solution of Greece debt crisis currency values
including Rupiah tend to be uplifted. A condition as such eased anxiety of the
moneymarket over risky market and build hope for economic recovery in Europe.
Business statement in Germany increased in December, which supported hope for
recovery of the biggest economy in Europe after slightly being under pressure
in the past few months.
By end of last week (21/12) Rupiah tend to move
sideways in line with the market attiude which still took the wait and see
position. Market players were still observing the fiscal cliff problem in the
USA toward year end. Bank Indonesia was still safeguarding Rupiah value againts
USD until fluctuation stabilized.
BI
stated
that weakeinig Rupiah value through 2012 was only temporary solution toward
restructuring Indonesia’s economy. The trend of lowored export through this
year brought the problem of Indonesia’s economic structure to the surface. In
fact the power of the domestic market had jacked up import since 2010 in line
with increasing foreign investment and consumtion in Indonesia.
Import
up jump was the consequences of incapability of the industry in procuring
capital goods and need for oil which continued constantly. However the
preassures of import on current transaction through 2010 - 2011 was still light
because it was axxompained by increased price of natural resource commodities
in export.
BI’s
strategy to let Rupiah weaken was an effort to support external economic
belance. Weakening of Rupiah over the year which came to 6% had downpressed
import of consumers goods especially luxurious goods.
Data
of BPS showed downturn of import of consumers goods by 1.33% from USD 11.19 billion in
January - October 2011 to
become USD 11.05 billion through January - October 2012. Contribution of consumer goods
in the same period dropped from 7.9% to 6.94% Rupiah depreceiation did not help
export much as shown by unchanged export volume only import must be reduced.
The
Government continued effort to improved the supply side of Indonesia’s
economy by increasing the upstream industry. Lowered percentage of raw materials and
auxiliary materials of Indonesia’s total import showed improvement of capacity in upsteam
and intermediary industry. Use or raw materials apparently lessened. After
import of capital goods was completed in 2011 - 2012, investment
would again boots productivity.
One
thing was sure analysts and economists were optimistic that weaking of Rupiah
would
not discourage foreign investors to do business here. Indonesia’s appeal to
investors was still strong provided BI and the Government of RI could maintain
stability of Rupiah value.
A
combination of good news from Europe and BI’s firm attitude to safeguard Rupiah indicated
that Rupiah position would remain strong till end of this year in the range of
Rp 9,600 – Rp. 9,650 per USD.
The
Capital Market
Just
as the development of Rupiah value at the moneymarket which tend to improve, in
this year 2012 which would end soon, performance of the stockmarket wouls also
improve. Normally at year end there was rally of shares, i.e. shares increasing
significantly at the stockmarket, local or international, due to sentiments of
window dressing.
Activities
of Window Dressing during year end was when companies and emitents dressed up
to beautify their financial report at the year end, which usually had its
impact on shares movement. The sentiments of Window Dressing during year end
could breeze out hope to share prices, making prices of blue chips shares to
soar up high.
The
only thing was that this
year the US stockmarket had to
face the classical problem of Fiscal Cliff which means that the US economy was
at the risk of free fall because of two parallel dangers. The first version of Fiscal Cliff
was tax axing in the era of George Bush which was to end this year causing tax
tariff in the US to soar up. The tax increase was feared to press down
purchasing power
of American citizens and American companies which tend to weaken economy.
The
International Monetary Fund (IMF) predicted that the Fiscal Cliff would axe 4% of US GDP, while
US economy was only to grow by 2.3% this year. Meaning if the Fiscal Cliff was
not immediately increased, soon in 2013 America would fall into recession. The
effect of “fiscal cliff” to the world’s economy could be serious, starting from
downfall of global trading to slump
of world’s commodity prices and lloss of market trust which might affect
investments and bank’s credit all over the world.
According
to Fitch Ratings, the Fiscal Cliff was the biggest single threat in the short
run to global economic recovery. Naturally the US Government would run a
certain policy to troubleshoot this Fiscal Cliff, threat however big the risk.
At
the moment they were quite relieved as there was ray of hope among US top
executives in overcoming this “fiscal cliff”. The silver linings appeared
toward solution of the fiscal cliff as President Barrack Obama recommended
increase of tax up to 2% on America’s top richest person. The solution was
indeed unpleasant for the tax targets but it could save America from the fiscal
cliff.
Unless the problem was solved, Governor of
the Fed Reserve Ben Bernanke would be in big trouble next year. However, as
long as there was nio definite decision, plan remained to be plan. Investors of all over the world were still waiting for result of
this fiscal cliff solution, Indonesia investors at
the stockmarket were no exception.
No
doubt about it, wait and see had made IHSG to consilidate since October 2012
till December 2012 between the level of 4,250 and 4,350 where IHSG had not
managed to exit from that consolidation level. In view of such a situation the
fiscal cliff would ease all the hectic trading of shares in the domestic stockmarket,
unless before 2012 definite solution was found to overcome the fiscal cliff.
Besides,
by end of the year investors tend to safeguard their money by walking out of
the stockmarket hall and enjoy a long year end holiday until the stockmarket turned
quiet. Some shares which were on the upturn were the sectors of construction,
infastructure, and consument goods.
Shares
of the banking sector were energized. China’s economy which was on recorvery
might pose as positive seniment to shares of the coal mining sector in 2013
which was entering saturated moment today and was of cheap value.
One
things was sure IHSG during the first session last weekend (21/12) inched down by 1
point as weakenng Asian stockmarket gave negative sentiment to index movement. To start
last transaction before Christmas of 2012, ISG was opened to inch down by 3.115
points (0.07%) to the level of 4,251.701.
Although opened weak, gradually index was brounching back to the green zone.
Shares
of consumers goods and basic industry to the lead in strengthening with strong
upjump, which successfully brought index to its highest level today at
4,276,898. Some shares were still subject to profit taking, making
strengthening process to slightly slow down. During closing session 1 on Friday
(21/20) IHSG continued to thin out by 1.559 points (0.04%) to the level of
4,253.257. Meanwhile index of LQ 45 inched up by 0.133 points (0.02%) to the
level of 726.489.
Towward
Christmas holidays many investors took vacation so the transaction value was
lower than the days before. However, some investor were still making act of
selective buying. Transactions were happening the quiet way with frequency of
transaction reaching 53,207 times at the volume of 2.105 billion shares worth
Rp 1.95 trillion. 75 shares went up, the remaining 136 shares went down and
another 90 remained stationary.
The
prospect of shares investments in the Indonesian stockmarket in 2013 had high
growth potentials. It was believable that the prospect of shares investment in
Indonesia remained prospective and had enough room for high growth. Shares of
the infrastructure sector, property, and consume goods was sustainer of IHSG
growth.
The
potential for shares growth of the property sector was already seen in early
2012 till end of quarter III this year. The property sector posted highest
earning-per-shares compared to other sectors, i.e. around 57% while index of
the propery sector year-to-date rose by 53.8%.
Income
of propery emitent would increase while price of shares was being appreciated
by early 2013 provided national economy was not disturbed. Performance of IHSG
2013
was expected to still be giving attractive return thanks to Indonesia’s economy
growth which was safeguarded and supported by domestic consumption and stimulus
of infra structure. Index of BRI was set to meet target of 5,000 - 5,500 points.
The
policy of low interest rate carried out by all nation and “quantitative easing”
done by the US Government had its impact on foreign capital inflow. The return
of Indonesian stockmarket emitent performance was still interesting to be
discussed. The premium sector was consumption, cement, infrastructure,
construction, banking, and trading. However, some risaks to be observed were
continuing slowdown of global economy which continues and solution of long and
dragging Europe problem.
Before
embarking on 2013 with optimism, this week IHSG was predicted to move up in the
range of 4,275 - 4,325. (SS)
Business News - December 28, 2012
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