Indonesia's Composite Stock Price Index (IHSG) Closed Lower Ahead of The Fed's Interest Rate Announcement (Wednesday, May 3, 2023)
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The Jakarta Composite Index (JCI) fell 50.58 points, or 0.74%, to close at 6,812.722 on Wednesday, May 3, 2023.
The index weakened ahead of a meeting of the United States Federal Reserve (The Fed) to determine its benchmark interest rate policy.
"The movement of the JCI and regional Asian exchanges was dragged into the weakening zone, apparently under selling pressure influenced by the upcoming release of The Fed's benchmark interest rate. This naturally makes market players or investors tend to adopt a wait-and-see attitude, awaiting the outcome of The Fed's FOMC decision," said the Research Team of Pilarmas Investindo Sekuritas, as quoted by Antara, Wednesday (3/5/2023).
The Fed will hold its Federal Open Market Committee (FOMC) Meeting early Thursday morning, May 4, 2023, Indonesian time.
The CME Fed Watch Group gives an 86.7% probability that The Fed will raise its benchmark interest rate by 25 basis points, while the probability of the interest rate remaining unchanged is 13.3%.
The Pilarmas Investindo Sekuritas Research Team continued, stating that the attitude of market players or investors is in line with the US economic conditions being overshadowed by a banking crisis after the collapse of several banks, which disrupted the financial system.
According to the Pilarmas Investindo Sekuritas Research Team, US Treasury Secretary Janet Yellen's statement regarding the risk of debt default has led the market to worry that the central bank might still use aggressive monetary tools to combat inflation.
"This could potentially put pressure on the US economic recovery, as the market anticipates that The Fed has room to raise its benchmark interest rate," said the Pilarmas Investindo Sekuritas Research Team.
Based on RTI Business data, the frequency of stock trading on the domestic exchange today was 1.32 million transactions.
A total of 15.26 billion shares changed hands, with a transaction value of Rp 10.49 trillion.
ISAP was the top loser, weakening by 8.16%, followed by TRJA and PTBA, which contracted by 7% and 6.99%, respectively.
Today's top gainers were SAGE, which strengthened by 24.51%, followed by PIPA and HAJJ, which strengthened by 15.13% and 9.94%, respectively.
The majority of stocks closed lower today. Specifically, 337 stocks weakened, 206 stocks strengthened, and 190 stocks were stagnant.
"Disclosure: This is an AI-generated translation of the original article. We strive for accuracy, but please note that automated translations may contain errors or slight inconsistencies."
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