Solid Opening Seen For Indonesian Stocks

(RTTNews) - The Indonesian stock market has closed lower now in two straight sessions and in five of the last six trading days, surrendering more than 150 points or 12 percent in that span. The Jakarta Composite Index has fallen through support at 1,200 points, but analysts suggest the market may reclaim that mark at the opening of trade on Wednesday - although it may or may not be able to maintain that positive sentiment throughout the session.

The global forecast for the Asian markets is fairly optimistic for the first time in nearly a week - but while many of the bourses have opened higher, they are proving unable to sustain the gains. Some better than expected corporate news helped to offset lingering concerns over a deep worldwide recession, as did some better than expected economic news out of the United States. Finally, many of the Asian markets are mired in substantial losing streaks and simply are due for correction, sinking to levels that are highly attractive to the bargain hunters.

The JCI finished sharply lower again on Tuesday as the financials fell under heavy selling pressure throughout the session. For the day, the index lost 47.07 points or 3.8 percent to close at 1,189.86 after trading between 1,167.85 and 1,231.98. There were 136 decliners and 17 gainers. Among the decliners, Bank Negara Indonesia tumbled 7.29 percent, while Indah Kiat Pulp & Paper fell 7.14 percent and Aneka Tambang dropped 6.06 percent.

The lead from Wall Street is finally positive as stocks showed a lack of direction over the course of the trading day on Tuesday, with the major averages unable to sustain any significant moves on the heels of some mixed news. The markets eventually ended the day higher on some late-day strength.

In corporate news, computer and printer maker Hewlett-Packard (HPQ | Quote | Chart | News | PowerRating) forecast fourth quarter adjusted earnings and revenues above analyst estimates. The company said it expects to report adjusted earnings for the quarter of $1.03 per share on revenues of $33.6 billion.

Separately, Yahoo (YHOO | Quote | Chart | News | PowerRating) CEO Jerry Yang announced that he will step down from his position as soon as the Internet firm can find a replacement. Yang's tenure was recently marked by his refusal to sell the company to Microsoft (MSFT | Quote | Chart | News | PowerRating).

Nonetheless, while shares of HP and Yahoo responded positively to the news, the positive sentiment was partly offset by a warning from medical device maker Medtronic (MDT | Quote | Chart | News | PowerRating), which lowered its full year revenue guidance due in part to the negative impact of current exchange rates.

On the economic front, the Labor Department said that its producer price index fell 2.8 percent in October following a 0.4 percent decrease in September. The decrease marked the biggest one-month drop in prices since the government began recording the data in 1947. While economists had expected prices to show a notable decrease, they had been expecting a somewhat more modest 1.8 percent decrease in prices. However, excluding a 12.8 percent drop in energy prices as well as a 0.2 percent decrease in food prices, core producer prices increased by 0.4 percent in October, matching the increase that was seen in the previous month.

In other news, Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke attempted to defend changes to the Troubled Asset Relief Program in testimony before the House Financial Services Committee

"The value of the TARP in promoting financial stability has already been demonstrated," Bernanke told the committee in prepared remarks. "There are some signs that credit markets, while still quite strained, are improving."

The major averages all ended the session in positive territory, although the tech-heavy Nasdaq posted only a modest gain. The Dow closed up 151.17 points or 1.8 percent at 8,424.75, the Nasdaq closed up 1.22 points or 0.1 percent at 1,483.27 and the S&P 500 closed up 8.36 points or 1.0 percent at 859.11.

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