Indonesian equities fell 90 points, or 1.4%, to 6,502 in Friday morning trading, extending losses into a third consecutive session and marking their lowest level in two weeks. Sentiment was dampened by an overnight sell-off on Wall Street amid a renewed surge in oil prices, while the latest U.S. producer price inflation figures bolstered expectations of an imminent Federal Reserve rate hike.
On the domestic front, worries over oil prices holding above USD 100 per barrel added to the pressure. As a net oil importer, Indonesia faces the risk of deteriorating fiscal conditions from elevated energy costs. Even so, the downside was partially limited by fresh data showing that retail sales increased in July for the first time in four months, supported by government measures designed to cushion households from elevated living costs.
Losses were broad-based across all major sectors, led by healthcare, cyclical stocks, basic materials, and transportation. Among the notable decliners were Charoen Pokphand (-3.7%), Japfa Comfeed (-3.0%), and ESSA Industries (-2.9%). For the week, the local market is on track for a sharp decline of around 2%, reversing gains from the previous period.
