JCI Down on Fuel Price Hike Plan

TEMPO.CO, Jakarta – The domestic stock market posted another correction as it still anticipates the government's plan to raise subsidized fuel oil prices. Investors worry that the hike would increase issuers' operational expenses, prompting them to reduce stock ownerships. As a result, the Jakarta Composite Index (JCI) lost 22.99 points (0.46 percent) to close yesterday's trade at 5,001.30.

Telkom's (IDX: TLKM) decline by 4.3 percent to Rp2,685 per share was the JCI's main achor. The index was further corrected by foreign investors' selloff, noting Rp638 billion in foreign net sales.

David Sutyanto, chief researcher at First Asia Capital, said that ahead of the fuel price hike investors are reluctant to hold on to their stock portfolios.

Yesterday's meeting to discuss the planned fuel price hike at the Coordinating Ministry for Economic Affairs office implied that the government is preparing to make a decision. "The fuel price hike, which is expected to reach Rp3,000, prompted investors to realize profits by selling," David said yesterday.

The selloff was also triggered by the Federal Open Market Committee meeting. The Fed is predicted to end its third quantitative easing, making investors reluctant to accumulate shares.

Today the JCI is predicted to move in the range of 4,950-5,040 bps. Investors are advised to consider ASII, BBRI, BMRI, AALI, and LSIP. 

PDAT | MEGEL JEKSON