IDX daily transaction continues to hike

JAKARTA. Transaction value in Indonesia Stock Exchange (IDX) increased significantly during August. According to Bloomberg, daily transaction value in August in regular market and other markets in average reached Rp 8.3 trillion.

According to Main Director of IDX Tito Sulistio, prices of some shares increased as a results of tax amnesty euforia. “Daily transaction value increased from IDR6 trillion to Rp 8 trillion”, Tito said.

He added,  there were corrections but those caused more by people's reaction in anticipating The Fed (American Central Bank) plan to increase interest rate.

Tito said, even though tax amnesty revenues are still lower than expectation, this government program has excited market players. As is known, tax amnesty aims at luring taxpayers to repatriate their funds to Indonesia. Tito added that domestic stock exchange is still attractive to foreign investors.

Analyst of First Asia Capital David Sutyanto said that IDX claimed in average of Rp 1 trillion  capital inflow per day during August, and an Rp 37.38 trillion of foreign investors buy net during 2016. 

However, David said that recently Jakarta Composite Index (JCI) is entering consolidation phase, mainly because the euphoria of tax amnesty is fading away. Market adopt  wait and see stance on the results of tax amnesty in September. He added that JCI will increase if the implementations of tax amnesty perform positive results.

Director of Investa Sarana Mandiri Hans Kwee is optimistic that IDX may record an Rp 6.5 trillion of daily transaction value. He said that the involvement of some conglomerates in tax amnesty program has given positive signs to the market. Hans also expect that the program will meet a minimum target of an IDR70 trillion of revenues. 

According to Hans, in September market will be driven by sentiments from abroad, such as FOMC meeting that will make decision on The Fed's interest rate. However, he said that it is unlikely that The Fed will raise the interest rate in September. 

Tito Sulistio revealed that recently IDX has not yet recorded capital inflow from repatriation funds through share  crossing. Tito called government to expand the number of gateways companies that receive tax amnesty fund from only 19 companies. 

According to Tito, government and IDX need to be active in socializing tax amnesty program. “I have met many businessmen, and they have made commitment to join this program”, he said. Financial Supervisory Authority (Otoritas Jasa Keuangan or OJK) and government are planning to expand number of gateway companies from 19 to 60, consist of 30 securities companies and 30 investment management companies. 

David Sutyanto added that if the tax amnesty program performs positive results this month, IDX's daily transaction value may hit Rp 7 trillion and JCI will stand at a level of 5,600. (Translator: Muhammad Farid)