JAKARTA, KOMPAS.com – The Indonesian Composite Index (ICI) of the Indonesia Stock Exchange (IDX) is projected to slide into negative territory on Thursday, June 25. The index closed in the green zone after climbing 1.75 percent to 4,964 on Wednesday, June 24.
Director of Anugerah Mega Investama Hans Kwee said the weakening was driven by the increasing number of Covid-19 cases in several countries after restarting economic activity. This warning was previously made by White House Health Advisor Dr. Anthony Fauci as the Covid-19 second wave started to have an impact on the economy.
“We expect the index to fall as the market sees the Covid-19 cases are soaring and starting to affect the economy, making them anxious,” Hans said Thursday, June 25.
Besides, he added, the US plan to impose new tariffs on European exports such as olives, alcoholic beverages, and trucks has become the main market sentiment today.
“Besides Covid-19, what has also been the concern in the market includes the likelihood of the US imposing tariffs on Germany, UK, Spain, and France that related to trade war, which will also raise market concerns,” he said.
The trade war sentiment and the increasing number of the Covid-19 cases led to the significant drop in the Europe and US index during the final transaction yesterday. The FTSE Index dropped 196.4 points or 3.11 percent, Xetra Dax Index fell 429.81 points or 3.43 percent, while the Dow Jones Index plunged 700 points or 2.72 percent.
Meanwhile, in Indonesia Hans said a wave of layoffs began to be a big challenge for the government.
The country’s Anti-Corruption Commission (KPK) recommendations to stop the pre-employment card program have become a concern to the market.
He said the pre-employment card program was good but there’s still room for improvement.
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