Indonesia Bourse May Test Resistance At 7,800 Points

(RTTNews) - The Indonesia stock market has tracked higher in three straight sessions, improving more than 300 points or 4 percent along the way. The Jakarta Composite Index now sits just above the 7,790-point plateau and it may at least open higher again on Wednesday.

The global forecast for the Asian markets is upbeat on an improved outlook for interest rates. The European markets were mixed and the U.S. bourses were up and the Asian markets figure to follow the latter lead.

The JCI finished sharply higher on Tuesday with gains from the financial, resource and telecom sectors, while the food and cement stocks were soft.

For the day, the index surged 185.77 points or 2.44 percent to finish at 7,791.70 after trading between 7,646.91 and 7,800.83.

Among the actives, Bank CIMB Niaga advanced 1.17 percent, while Bank Mandiri accelerated 4.03 percent, Bank Danamon Indonesia perked 0.39 percent, Bank Negara Indonesia spiked 3.81 percent, Bank Central Asia collected 3.51 percent, Bank Rakyat Indonesia soared 6.30 percent, Indosat Ooredoo Hutchison climbed 2.21 percent, Indocement stumbled 3.38 percent, Semen Indonesia slumped 1.50 percent, United Tractors and Indofood Sukses Makmur both fell 0.31 percent, Astra International jumped 1.84 percent, Energi Mega Persada rallied 3.74 percent, Astra Agro Lestari dropped 1.74 percent, Aneka Tambang declined 1.36 percent, Timah added 0.50 percent, Bumi Resources improved 1.85 percent and Vale Indonesia was unchanged.

The lead from Wall Street is firm as the major averages opened higher and continued to accelerate as the day progressed, ending near session highs.

The Dow surged 483.52 points or 1.10 percent to finish at 44,458.61, while the NASDAQ rallied 296.50 points or 1.39 percent to close at a record 21,681.90 and the S&P 500 climbed 72.31 points or 1.13 percent to end at 6,445.76, also a record.

The strength on Wall Street followed the release of the Labor Department's closely watched report on consumer price inflation for July, which was in line with expectations.

Despite the faster than expected annual core price growth, traders seem to believe the data increases the chances the Federal Reserve will lower interest rates next month.

Following the release of the report, CME Group's FedWatch Tool is indicating a 94.4 percent chance the Fed will cut rates by a quarter point in September.

Crude oil prices slumped on Tuesday ahead of an upcoming meeting between the U.S. and Russian presidents on Friday in Alaska. West Texas Intermediate crude for September delivery was down $0.88 or 1.38 percent at $63.08 per barrel.