The Indonesia stock market on Wednesday halted the four-day slide in which it had retreated more than 65 points or 1.5 percent. The Jakarta Composite Index closed just above the 4,275-point plateau, although now analysts are forecasting a lower open when the market kicks off trade on Thursday.
The global forecast for the Asian markets suggests consolidation thanks to continued concerns about the looming fiscal cliff in the United States, along with profit taking following gains in the previous session. In Washington, lawmakers have only a few days to reach a budget agreement before the year-end deadline. The European and U.S. markets were down on Wednesday and the Asian bourses are expected to open in similar fashion on Thursday.
The JCI finished modestly higher on Wednesday following gains from the resource stocks.
For the day, the index climbed 24.88 points or 0.59 percent to finish at 4,275.09 after trading between 4,245.32 and 4,275.10.
The lead from Wall Street is negative as stocks moved mostly lower on Wednesday amidst subdued selling pressure. Continued concerns about the looming fiscal cliff weighed on investor sentiment, with the markets extending the downward move seen over the two previous sessions.
Traders expressed pessimism about the fiscal cliff negotiations, as lawmakers have only a few days to reach a budget agreement before the year-end deadline. While President Barack Obama headed back to Washington after spending the holidays in Hawaii, the latest developments have not inspired much confidence.
Last week, House Speaker John Boehner, R-Ohio, scrapped plans to hold a House vote on his Plan B legislation due to a lack of support among members of his own party. The legislation would have extended the Bush-era tax cuts for people making up to $1 million, although Democrats claimed it would raise taxes on millions of working families by eliminating certain tax credits.
Following the failure of Plan B, Republicans attempted to put the pressure in the budget negotiations back on Obama and Senate Democrats. Unless an agreement is reached, approximately $600 billion in automatic tax increases and government spending cuts are due to go into effect at the end of the year.
Those concerns overshadowed a report from Standard & Poor’s showing the strongest annual rate of growth in home prices in over two years. The S&P/Case-Shiller 20-City Composite Home Price Index was up by 4.3 percent on month in October versus estimates for a 4.1 percent increase.
Trading activity remained relatively subdued, as many traders were away from their desks following the holiday on Tuesday.
The major U.S. averages were lower on Wednesday as the Dow edged down 24.49 points or 0.2 percent to finish at 13,114.59, while the NASDAQ fell 22.44 points or 0.7 percent to end at 2,990.16 and the S&P 500 slid 6.83 points or 0.5 percent to close at 1,419.83.
by RTT Staff Writer
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