JAKARTA (TheInsiderStories) – Indonesia’ Financial Services Authority (FSA) noted, foreign investors recorded a net sell of up to Rp12.6 trillion (US$887.32 million) in the stock and bond markets since early August 2019 until now.
This net sell occurred along with the weakening of the Jakarta Composite Index (JCI) in the same period by 2.11 percent to 6,255.6, the agency wrote in a written statement on Thursday (8/29).
The agency revealed the tension of trade war between the United States (US) – China and the devaluation of the Yuan against the US Dollar made capital move out from Indonesia so the financial markets underwent a correction.
As a result, JCI on August 23, 2019, was recorded to weaken by 2.11 percent (month to date/mtd) at the level of 6,255.6. While bond-market yields recorded an average increase of 1.5 bps (mtd). Foreign investors also booked a net sell on the stock and government bond markets amounting to Rp12.6 trillion (mtd).
However, JCI and government bonds still recorded positive performance since the end of December 2018 to date by increasing 0.99 percent in JCI and decreasing 76.5 bps in a government bond. Foreign investors also recorded a net buy in the stock and bonds markets amounting to Rp175.6 trillion in the same period.
Overall, the FSA assesses the stability of the financial services sector in July 2019 in a maintained condition amid the global economic slowdown and the increasing tension of the US-China trade war. The domestic financial services sector is resilient with positive intermediation growth and the risk profile of a manageable financial services institution.
The intermediary performance of financial service institutions also grew positively in July 2019. Banking loans recorded growth of 9.58 percent (YoY), with investment loans that grew of 13.75 percent (YoY).
In terms of fundraising, bank deposits are on an upward trend and growing by 8.04 percent (YoY). This increase was driven by the growth of current accounts which reached 9.68 percent (YoY).
Meanwhile, from January until July 2019, insurance industries collected premiums of Rp163.12 trillion. Furthermore, the capital market was able to collect funds of Rp120.8 trillion until August 26, 2019, higher than the same period the previous year of Rp113.8 trillion. The number of new issuers in the period was 34 issuers with a total offer of Rp22.51 trillion.
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