Analyst: JCI rebounds 4% on buybacks and regulatory measures
Jakarta (ANTARA) – BRI Danareksa Sekuritas analyst Helmy Kristanto said several factors had driven the Jakarta Composite Index (JCI) to rebound by 208.02 points, or 4.16%, to 5,204.63 at the close of Tuesday’s (20 October) first trading session.
Among these, he said, were share buyback plans by several listed companies and a number of policy initiatives by the Indonesia Stock Exchange (IDX) in response to an evaluation by Morgan Stanley Capital International (MSCI).
“Resistance is at 5,318–5,400. This area is a rebound target as well as an initial test of the strength of the recovery,” Helmy said in a market review in Jakarta on Tuesday.
Helmy outlined several factors behind the JCI’s gains. First, a number of listed companies have set aside funds for buybacks, potentially supporting share demand amid market volatility.
The second factor is the IDX’s plan to expand disclosure of affiliations among shareholders holding more than 1% and to exclude shares with High Shareholding Concentration (HSC) status from the JCI calculation.
“Implementation of this policy is being closely watched as a means of restoring investor confidence,” Helmy said.
Third, he said, Danantara’s readiness to increase its stakes in state-owned enterprises (SOEs) had bolstered optimism about state-owned banks’ shares, which also helped drive the JCI higher.
Fourth, commitments by the Financial Services Authority (OJK) and the government to reform, enforce rules over suspected coordinated trading and improve transparency have acted as positive catalysts.
“However, the market is still waiting for evidence of consistent implementation amid MSCI’s consultation on Indonesia’s reclassification,” Helmy said.
At the close of Tuesday’s (20 October) first trading session, the JCI had gained 208.02 points, or 4.16%, to 5,204.63. The LQ45 index, which tracks 45 leading shares, rose 31.27 points, or 6.40%, to 519.73.
Share trading totalled 1.63 million transactions, involving 39.30 billion shares worth Rp17.13 trillion. A total of 654 shares rose, 137 fell and 172 were unchanged.
All 11 sectors in the IDX-IC sectoral indices advanced. Transport and logistics led the gains, rising 6.49%, followed by basic materials and property, up 4.63% and 4.55%, respectively.