Today’s US dollar strength is attributed to benchmark 10-year US treasury yields hovering near their highest level in seven years. Meanwhile, the latest comments of US President Donald Trump on trade negotiations with China cause some concern. Trump said he doubts the ongoing Saham.news with China in Washington will turn out to his satisfaction because “China has become very spoiled”. Trump also said “the European Union (EU) and other countries have become very spoiled simply because they always got 100 percent of whatever they wanted from the USA.”
Such statements cause renewed concerns regarding the breakout of any global trade war. But on the contrary, the EU vowed that it must be ready to negotiate opening its markets wider to US imports – including car shipments – in a bid to avert a prospective trade war.
In the May 2018 policy meeting (concluded on Thursday) Indonesia’s central bank (Bank Indonesia) made a decision to raise its benchmark interest rate by 25 basis points to 4.50 percent in order to reduce heavy pressures on the rupiah.
Another issue – the one that is giving rise to geopolitical concerns – is the news that North Korea canceled high-level talks with neighboring South Korea on Wednesday (16/05) since the latter remains involved in military exercises with all the USA. Serious doubts have finally emerged on whether the historic summit with North Korean leader Kim Jong Un and US President Donald Trump goes-ahead as planned on 12 June 2018.
As opposed to Indonesian bonds and the rupiah, the Analisa Berita Pasar Modal ended slightly in green territory ( .06 percent) on Wednesday (16/05) after recovering from deep red territory which was touched earlier in the day. Indonesian stocks happen to be sliding significantly over the past handful of weeks and now have actually become quite attractive, specifically for long term investors. To date in 2018 foreign investors have already been net sellers of approximately USD $2.9 billion of Indonesian stocks, implying ifhvlq Indonesian equities would be the worst performer in Asia up to now this season.
Meanwhile, the central bank of Indonesia (Bank Indonesia) is scheduled to conclude its monthly monetary policy on Thursday (17/05). We expect Bank Indonesia to boost its benchmark interest rate (the 7-Day Reverse Repo Rate) from 4.25 % to 4.fifty percent in order to secure the Indonesian rupiah which has been under heavy pressure in recent weeks. In theory a rate hike is negative for stocks. However, we would not surprised to view Indonesian stocks react positively to a rate hike tomorrow.
Meanwhile, Rekomendasi Saham Gratis is moving flat up to now on Friday (18/05), shifting from green to red and back. Apparently, investors are confused whether or not to invest now (and benefit from the recent decline of Indonesian stocks) or stay away from investing as stocks may decline further within the next couple of trading days.