JCI Shoots Up on Fuel Hike; Remains Prone to Correction

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  • Ilustrasi Indeks Harga Saham Gabungan (IHSG). ANTARA/Yudhi Mahatma

    Ilustrasi Indeks Harga Saham Gabungan (IHSG). ANTARA/Yudhi Mahatma

    TEMPO.CO, Jakarta - The Jakarta Composite Index (JCI) managed to gain sharply, responding to the increase of subsidized fuel prices. Investors, bullish on the long-term prospects of JCI, decided to bulk up on stocks, allowing the index to close 48.53 points (0.96 percent) higher to 5.102 bps.

    Panin Sekuritas chief researcher Purwoko Sartono confirmed that the index moved up as with positive sentiments from the raised fuel prices. As the long-anticipated fuel hike plan materialized spurred investors' buying optimism over an increased confidence on Joko Widodo's subsidy transfer and compensation scenario.

    "The JCI gain was also triggered by investors' optimism that the government is better-prepared in transferring subsidies," said Purwoko.

    However, Purwoko doubts that the index uptrend will last long. He reasoned that, historically, the index tends to experience technical adjustments before strengthening significantly in the long run. "Referring to historical facts, the potential short-term correction is great," he said.

    Purwoko advised investors to remain cautious in trading, especially for construction stocks such as Adhi Karya (ADHI) and Wijaya Karya (WIKA). Most of these stocks have been overpriced for quite some time, making them vulnerable to profit taking.

    Today the JCI is predicted to receive pressure, and move between 5,070 and 5,125 bps. With Asian exchanges still in a volatile phase, Purwoko reminded investors to be extra careful in trading stocks.

    PDAT | MEGEL JEKSON