Bank Indonesia intervened the spot foreign exchange market, domestic NDF and bond markets to stem outflows related to fears of the spread of coronavirus in the world - Photo: Antara

JAKARTA (TheInsiderStories) – Good Morning! Bank Indonesia intervened the spot foreign exchange market, domestic NDF and bond markets to stem outflows related to fears of the spread of coronavirus in the world. On Monday, there are outflows in the bond market and banks are short covering.

The central bank to do the policy with a flight to quality away from emerging market assets. A surge of infections in South Korea, Italy, the rising death toll in Iran and China so far yesterday, triggered steep falls in Asian share markets and Wall Street stock futures amid a flight to safety theme.

Related to the virus impact, President Joko Widodo chaired a limited meeting regarding the impact of the COVID-19 virus on the Indonesian economy. Many parties have reminded the world that all countries take steps to anticipate the outbreak.

While, coordinating minister for maritime and investment, Luhut Binsar Panjaitan had scheduled to open Nikkei Forum Jakarta 2020, held a press briefing, meet Iranian ambassador, Muhammad Azad, and lead a limited meeting on PT Pelabuhan Indonesia’ container terminal in East Java.

In addition, deputy minister of finance, Suahasil Nazara will attend a working meeting with the Regional Representative Council to discuss the Special Autonomy Fund and the Post-2020 Papua Special Autonomy Blue Print.

Yesterday, Indonesian Rupiah weakened 0.81 percent to the level of 13,872 a US Dollar and the Jakarta Composite Index down 1.28 percent to 5,807 compared to last week.

Today, the two major instruments is predicted still in negative territory again because the coronavirus again makes global concerns and uncertainties increase rapidly. Increasing cases outside China put pressure on various sides.

Italy has reported at least more than 200 cases with six deaths. While, cases in South Korea the virus spread rapidly and has reached 600 cases, also with 6 deaths.

On the other hand, many countries report their first cases such as Iran, Afghanistan, Bahrain and Kuwait. World Health Organization says that new cases that occur make the situation and conditions very alarming at this time.

The European market has experienced the biggest decline since June 2016, the S&P 500 has also experienced the deepest decline since February 2018, and yields on the 10-year US Treasury also fell to the lowest level since 2016.

Rupiah and the JCI is predicted to remain depressed on Tuesday in line with pressure from global sentiment. The market also is waiting for comments by Federal Reserve officials this week about the effects of the virus and the direction of policy

The analysts rate the local currency would likely continue to weaken today and move in the range 13,850 – 13,900 over the Greenback and the stock index between 5,744 – 5,850 compared to yesterday.

They recommended PT Bank Central Asia Tbk (IDX: BBCA), PT Unilever Indonesia Tbk (IDX: UNVR), PT Puradelta Lestari Tbk (IDX: DMAS), PT Indofood CBP Sukses Makmur Tbk (IDX: ICBP), PT Medco Energy International Tbk (IDX: MEDC), PT Sarana Menara Nusantara Tbk (IDX: TOWR), PT Indosat Ooredoo Tbk (IDX: ISAT), PT Bank Negara Indonesia Tbk (IDX; BBNI), PT Astra International Tbk (IDX: ASII), PT AKR Corporindo Tbk (IDX: AKRA), and PT CIMB Niaga Tbk (IDX: BNGA).

May you have a profitable day!

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