JAKARTA (TheInsiderStories) – Good morning! This week, investors will direct their attention to Indonesian investment data from the Investment Coordinating Board. With certainty after the 2019 election, the value of Foreign Direct Investment (FDI) in the second quarter of 2019 will improve.

As for the first quarter, realization investment Rp 195 trillion (US$13.73 billion) in the first quarter (1Q) of 2019, up 5.3 per cent rise compared to 1Q 2018 of Rp185.3 trillion. While, FDI inflows dropped 0.9 percent to Rp108.9 trillion compared to the last quarter of 2018 fell 11.6 percent and Domestic Direct Investment amounting to Rp87.2 trillion or rose 14.1 percent from 4Q 2018.

This week, the United Arab Emirates Prince Sheikh Mohamed bin Zayed Al Nahyan and his entourage, included 10 ministers and businessmen, to visit Indonesia discussing on economic and investment cooperation.

While, second quarter of United States’ (US) GDP numbers are expected to add to signs that economic growth has slowed sharply for many economies after a better-than-expected start to the year and intensified trade tensions. Then, Flash July PMI numbers for the US, Eurozone, Australia and Japan are released, with Japan including the service sector for the first time.

In Asia, the PMI and trade data will be scoured for signs of trade war impact, especially as mounting Japan – South Korea trade tensions could trigger a new trade war. With the Bank of Korea recently cutting interest rates to support growth, eyes will be on South Korea’ advance estimate of second quarter GDP, where IHS Markit forecast a weaker annual rate of growth at 1.4 percent.

Furthermore, a speech by Philip Lowe, governor of the Reserve Bank of Australia, will gather interest after latest meeting minutes hint at further monetary easing to boost job growth. On the Korean Peninsula, US’ national security adviser John Bolton travel to Japan and South Korea this week.

Two of Washington’ main allies currently involved in a trade dispute, which threatens the supply of global memory chips and smart phones. Japan has denied that a dispute over compensation was behind export restrictions, although one of its ministers cited disconnected trust with Seoul over a labor dispute in announcing restrictions.

Meanwhile, US state secretary Mike Pompeo met with Mexican Foreign Minister Marcelo Ebrard on Sunday (07/21) to discuss migration and trade, amid escalating bilateral tensions ahead of the deadline on an agreement that eliminates the threat of tariffs on Mexican exports.

After criticized by President Donald Trump, China finally made plans to buy agricultural products from the US simultaneously to show Beijing’ sincerity and good intentions to encourage bilateral trade negotiations.

The latest progress, Chinese Deputy Prime Minister Liu He spoke with US Trade Representative Robert Lighthizer and US Treasury Secretary Steven Mnuchin by telephone at the invitation last week. The two sides exchanged views about implementing the consensus reached at the G20 Summit and holding further talks.

Turning to Europe, Britain condemned Iran‘ seizure of a British-flagged oil tanker in the Gulf as a “hostile act” and refused Tehran’ explanation that they seized the ship because it was involved in an accident. The actions of the two countries are precisely in the global oil trade waterway and have been seen in the West as a major escalation after three months of confrontation that has brought Iran and the US to the brink of war.

Iran’ ambassador to Britain warned against escalating tensions when a British official refused to rule out sanctions in response to Tehran’ fight over a British-flagged oil tanker. Iran calls on Britain to hold back “domestic political forces that want to increase tensions between Iran and Britain beyond the ship’s problems.

The Coordinating Minister for Maritime Affairs Luhut Binsar Pandjaitan said that the Presidential Regulation on the electric cars would soon be completed. Under the regulation, the government stressed the importance of local raw materials and gave import quotas to companies that would make electric cars.

Energy and Mineral Resources ministry collaboration with Saga University from Japan will develop a pilot project for Power Ocean-based power plant with a capacity of 5 megawatts in the North Bali sea. The potential of Indonesian waters is predicted to produce around 240,000 megawatts. After being mapped, in eastern Indonesia, the temperature difference value is greater than in western Indonesia.

Followed the crash of PT Bank Mandiri Tbk (IDX: BMRI) system, Indonesia’ Financial Service Agency continues to monitor mitigation efforts carried out by the state-owned lender to overcome the information technology problems. The agency asked the bank to immediately report the problems and the steps they will take so that similar incidents do not recur in the future.

The regulator body also urged all banks to review their IT functions regularly in order to enforce prudent operational risk management and run well. This is a form of efforts to improve banking services in the future and prevent this problem from happening again in the future.

This week, the Jakarta Composite Index is predicted still on the positive performance and move in the green-zone after closing up 0.83 percent to 6,456.54 in trading last Friday. Sentiment on BI 7-DRR cuts by 25 basis points will still affect the composite index until Tuesday. Another sentiment also affected the JCI movement this week is the financial statements of second-quarter issuers.

For today, some observes recommended PT Astra Internasional Tbk (IDX: ASII), PT Bank Central Asia Tbk (IDX: BBCA), PT Telkom Indonesia Tbk (IDX: TLKM), PT Indofood Sukses Makmur Tbk (IDX: INDF), PT HM Sampoerna Tbk (IDX: HMSP, and PT ICB Sukses Makmur Tbk (IDX: ICBP) stocks to be watch.

While the Rupiah its expecting will continue to strengthen this week, after last week it recorded a gain of 0.46 percent or 69 points to the level of Rp13,890 against the US dollar. The tendency of the strengthening of the local exchange rate was driven by a mechanism in the foreign exchange market cause investors and the banking industry positively welcomed BI’ decision to reduce its benchmark rate.

US$1 =Rp14,000

May you have a profitable week!

Written by Linda Silaen and TIS Intelligence Team, Please Read Our Insight to Get More information about Indonesia