TEMPO.CO, Jakarta - Investors will hold back from making major buying decisions this week, analyst said, preferring to wait until listed companies release their second quarter financial statements.
A depreciated rupiah was investors' main reason to sell their stocks over the last two days, causing the Jakarta Composite Index (JCI) to slip. Recapital Securities analyst Liga Maradona said the rupiah's continued correction to Rp13,447 per US dollar increases the risk of stock ownership.
"No one is optimistic about the performance of listed companies when the rupiah continues to weaken," he said.
Liga said a corrected rupiah would increase issuers' operating costs as imported raw materials will be more expensive and foreign debt valuation ballooned.
Not only that, the index correction is also triggered by slow trading activities post the Eid holiday. Even a moderate selling frequency, Liga said, could easily put a halt over the JCI's pace.
This week, the index is projected to move sideways with a tendency to go up between 4840-4900 bps. Issuers are expected to release their financial statements this week, which is predicted to reduce selling.
"There is a huge chance that listed banks will publish their second quarter statements this week," he said.
Investors are advised to pay attention to stocks that have been corrected and now have the potential for technical rebounds such as ADRO, JSMR and PGAS, which Liga project would be hunted by investors that enter the bourse today.
However, expectations of a rate hike announcement by the Federal Reserve in this week's FOMC Meeting will pose a negative sentiment. Until there is some kind of certainty about the announcement, foreign investors are expected to wait and see; reluctant to take buying positions.
PDAT | MEGEL JEKSON