The JCI August 11, 2020
Aᴜɢᴜsᴛ 11, 2020
* Tʜᴇ JCI ᴛʀᴀᴅɪɴɢ ʀᴀɴɢᴇ: 5,100ᴘᴛ – 5,225ᴘᴛ ( Yᴇsᴛᴇʀᴅᴀʏ ᴄʟᴏsᴇ: 5,158ᴘᴛ)
* Tʜᴇ DJIA ᴀɴᴅ S&P 500 ᴇɴᴅᴇᴅ ᴍᴏᴅᴇʀᴀᴛᴇʟʏ ʜɪɢʜᴇʀ ɪɴ ᴀɴᴛɪᴄɪᴘᴀᴛɪᴏɴ ᴏɴ ɴᴇxᴛ sᴛɪᴍᴜʟᴜs ʙɪʟʟ
* Tʜᴇ JCI ɪs ᴇxᴘᴇᴄᴛᴇᴅ ᴛᴏ ꜰʟᴜᴄᴛᴜᴀᴛᴇ ᴡɪᴛʜ ᴛᴇɴᴅᴇɴᴄʏ ᴛᴏ ᴄᴏɴsᴏʟɪᴅᴀᴛᴇ ᴀɴᴅ ʙᴇɪɴɢ sᴜᴘᴘᴏʀᴛᴇᴅ ʙʏ sᴛᴀʙʟᴇ ᴏɪʟ ᴀɴᴅ USDIDR ᴄʟᴏsᴇ
Morning,
The Jakarta Composite Index (JCI) today (11/8) is expected to fluctuate and be in the range of 5,100pt – 5,225pt by support of stable USDIDR . Meanwhile yesterday (10/8) in Wall Street the DJIA ended higher by 358 points or 1.3% at 27,791pt , while the S&P500 and the Nasdaq gained and lost by 0.3% and 0.4%, respectively.
𝐈𝐧𝐝𝐨𝐧𝐞𝐬𝐢𝐚 𝐂𝐨𝐧𝐬𝐮𝐦𝐞𝐫 𝐒𝐞𝐜𝐭𝐨𝐫
𝐁𝐞𝐧𝐞𝐟𝐢𝐭𝐬 𝐟𝐫𝐨𝐦 𝐭𝐢𝐦𝐞𝐥𝐲 𝐛𝐚𝐧𝐤𝐢𝐧𝐠 𝐬𝐲𝐬𝐭𝐞𝐦 𝐚𝐥𝐞𝐫𝐭-𝐰𝐚𝐫𝐧𝐢𝐧𝐠 𝐬𝐢𝐠𝐧𝐬, 𝐚𝐧𝐝 𝐦𝐚𝐧𝐚𝐠𝐞𝐦𝐞𝐧𝐭
In the news early August, Indonesia financial authority the Financial Services Authority (OJK or “Otoritas Jasa Keuangan”) stated that as July 20, COVID-19 related credit restructuring has reached the total amount of IDR784.4tr. The amount, which constituted of 25%-30% the outstanding credits, originated both from individual and corporate borrowers who experienced difficulties to make interests and principal payments as a result of Covid-19 – related business deteriorations. 60% (sixty percent) of the amount , or about IDR454 tr came from corporate borrowers that covered 1.34mn contracts, while the rest from small and medium enterprises that inclusive of 5.38mn agreements.
The aforementioned profile of borrowers, pointed to corporate’s total average restructuring amount at IDR339mn per contract, implying around IDR1.4bn sum of debt per contract, while to small and medium enterprise’s borrowers average of IDR62mn per contract that imply an average of IDR250mn sum of debt.
Steps from OJK to involve in debt re-structuring at the initial stage is positive. Nevertheless, stronger advise for banks to provide supports in terms of business counsels to borrowers during the Covid-19 climate is not less important, in our view.
During the media release on August 4, the Chairman of Commissioner Board of OJK Wimboh Santoso also stated that current banks’ liquidity position as measured by the ratio of liquid assets to third-party-fund improved to 27.6% in July vs. 23.9% in February. Meanwhile, the ratio of liquid assets to non-core deposit improved to 130% in July vs. 113% in February.
OJK also issued other measures that facilitate banks’ operation to run smoother during the pandemic climate.
As banks operation that involve the collecting and disbursing of public funds rely on customers’ trust to run smoothly, management of information that ensured fair and responsible-transparency from the authority is crucial, in our note.
At the other end, yesterday the WTI price closed higher by 1.7% to USD41.9/barrel on improving Chinese factory data. Meanwhile the USDIDR closed at IDR14.750 vs. IDR14.647 the previous one.
We advise the following recommendation , for both trading and longer-time investment purpose. 𝐀𝐀𝐋𝐈, 𝐋𝐒𝐈𝐏 (𝐬𝐞𝐜𝐭𝐨𝐫 𝐨𝐟 𝘈𝘨𝘳𝘪, 𝐚𝐥𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐬𝐮𝐠𝐠𝐞𝐬𝐭𝐢𝐨𝐧 𝘜𝘯𝘥𝘦𝘳𝘸𝘦𝘪𝘨𝘩𝘵 ), 𝐔𝐍𝐓𝐑, 𝐈𝐓𝐌𝐆, 𝐀𝐃𝐑𝐎, 𝐏𝐓𝐁𝐀 (𝐬𝐞𝐜𝐭𝐨𝐫 𝐨𝐟 𝘊𝘰𝘢𝘭 𝘔𝘪𝘯𝘪𝘯𝘨, 𝐚𝐥𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐬𝐮𝐠𝐠𝐞𝐬𝐭𝐢𝐨𝐧 𝘔𝘢𝘳𝘬𝘦𝘵-𝘸𝘦𝘪𝘨𝘩𝘵), 𝐆𝐆𝐑𝐌, 𝐔𝐍𝐕𝐑, 𝐈𝐂𝐁𝐏 (𝐬𝐞𝐜𝐭𝐨𝐫 𝐨𝐟 𝘊𝘰𝘯𝘴𝘶𝘮𝘦𝘳, 𝐚𝐥𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐬𝐮𝐠𝐠𝐞𝐬𝐭𝐢𝐨𝐧 𝘖𝘷𝘦𝘳𝘸𝘦𝘪𝘨𝘩𝘵 ), 𝐀𝐒𝐈𝐈 (𝐬𝐞𝐜𝐭𝐨𝐫 𝐨𝐟 𝘈𝘶𝘵𝘰𝘮𝘢𝘵𝘪𝘷𝘦, 𝐚𝐥𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐬𝐮𝐠𝐠𝐞𝐬𝐭𝐢𝐨𝐧 𝘔𝘢𝘳𝘬𝘦𝘵-𝘸𝘦𝘪𝘨𝘩𝘵), 𝐚𝐧𝐝 𝐀𝐂𝐄𝐒, 𝐒𝐂𝐌𝐀, 𝐌𝐀𝐏𝐈 (𝐬𝐞𝐜𝐭𝐨𝐫 𝐨𝐟 𝘛𝘳𝘢𝘥𝘦, 𝐚𝐥𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐬𝐮𝐠𝐠𝐞𝐬𝐭𝐢𝐨𝐧 𝘖𝘷𝘦𝘳𝘸𝘦𝘪𝘨𝘩𝘵),𝐚𝐧𝐝 𝐓𝐊𝐈𝐌 (𝐬𝐞𝐜𝐭𝐨𝐫 𝐨𝐟 𝘉𝘢𝘴𝘪𝘤 𝘐𝘯𝘥𝘶𝘴𝘵𝘳𝘺, 𝐚𝐥𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐬𝐮𝐠𝐠𝐞𝐬𝐭𝐢𝐨𝐧 𝘔𝘢𝘳𝘬𝘦𝘵-𝘸𝘦𝘪𝘨𝘩𝘵).
Cheers,