While all the people of Indonesia are celebrating ied Fitri holiday, which is very surprising is the most extended holiday ever for the stock market. The Federal Reserve shocked the market by raising its interest rates. In this condition, the stock market of Indonesia was caught off guard. Before the long holiday took place, JCI showed a positive trend with a slight correction on the day of closing. However, after a long holiday, the JCI showed a mixed reaction and held at 5,832.58 points at its last close.
The federal reserve is raising its interest rates by 25 basis points at June 13. The implication of this policy is shown on the first day of trading since the long holiday. The negative sentiment from this policy and also exit of foreign investor lead to the huge correction of JCI. This policy will indeed trigger the central bank of Indonesia to gave counter policy such as raising its interest rate again.
Almost all sectors are influenced by this policy. Especially the Infrastructure and Property sectors. Both of it are heavily influenced by banks. The operating costs is financed by bank loans and if there is a rise in interest rates. It will affecting the whole company. In this condition investor will try to avoid this sectors.
but in such conditions the financial sector is very interesting to be observed because it is directly affected by this policy. evident from the performance of the financial sector that has been a support JCI for the last few days.