EM Equity Brief: The "Volume Divergence" in Jakarta
Fellow monkeys,
Quick desk note from Jakarta regarding the Dec 17 flows.
We are seeing a classic "False Breakout" pattern in the IHSG (Jakarta Composite) today, which offers a decent read on EM risk appetite post-Fed cut.
The Price Action: The index tested the psychological 8,700 handle this morning (High: 8,728) but failed to sustain the bid, retracing to 8,677 (-0.10%).
The Institutional View: The divergence here is stark.
- Volume Collapse: Turnover plummeted to ~25B shares vs 43B in the previous session. This indicates a complete lack of conviction from foreign institutional investors (FII) at these valuation levels.
- Sector Rotation: We are seeing a "Flight to Safety" within the index. High-beta Tech (GOTO) rolled over (-2.94%) after a dead-cat bounce yesterday. Meanwhile, Big Banks (BBRI, BBCA) are bid up (+1.3%, +0.3%) solely for defensive beta.
Macro Overlay: With USD/IDR testing 16,700 again and WTI Crude bouncing to $56 on supply jitters, the macro backdrop for net-importer EMs is deteriorating slightly.
Trade Idea: The failed break of 8,700 on low volume confirms a consolidation thesis. I am net neutral/defensive, overweight Banks, underweight Tech/Consumer Discretionary until volume confirms a move.
Quam maxime repellendus incidunt tempore. Velit nemo sapiente dicta magnam itaque veniam sed.
Perferendis et eum dolorem vel maiores ut consequatur. Aut dolor animi mollitia. Magnam commodi sed odit quas rem. Qui impedit odio perferendis eaque in ea. Nobis ex autem non dolorem. Maxime eaque ipsa alias consequatur nostrum aspernatur consequatur.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...