Morning Dew - 25 February 2014

Stepping Back

Post-breakout of key resistance on Friday, JCI fell to end at 4,623.57. Still, this is viewed  as a natural setback for the index. 

Some positive catalysts recently released were the improving CAD (hence lessened the odds that BI will raise rate again), the improving IDR, Bank of Japan’s continued stimulus, and Fed’s Janet Yellen’s statement that the tapering policy will continue on.

Chatib Basri said that GDP growth between 5.5%-5.8% is more realistic at the moment. Slower growth, according to Basri, will help trim CAD to 2.0%-2.5% of GDP. Basri’s target was below the APBN’s expectation that growth will be around 6.0%.

BBRM, SMGR, TBIG, & HERO

IDX’s newcomer BBRM booked an 8.66% increase in revenue throughout 2013, but its net profit tumbled to $5,497k from $7,007k or fell 21.55%.

SMGR’s revenue jumped 25.02% in 2013, while its net profit were up 10.79%. Assets grew 15.85% as liability grew less (+6.83%)

Net profit soared at HERO by 121.7%, whilst its liability fell 33.61% and its assets up 47.03%.

TBIG reaped 48.23% increase in net profit as its revenue climbed 56.84%.

Technically Speaking...

JCI retreated from its recent peak at 4,665, just above 4,650 resistance but ended the day at 4,623.57. 

Recent peak-turned-support at 4,610 will remain as the nearest support line for JCI, whereas the 200-day EMA at 4,440 will be the subsequent support area. Nearer support will be at 4,550 as this was the congestion area before the index rallied.

Nearest resistance is seen at around 4,650, Friday’s high. Meanwhile, 4,791 will be the next hurdle to crack should 4,650 gives way.

Volume and MACD continued to tick down, capping the upside potential at the moment. For now, the outlook is biased to the downside as recent gains spells a near-term correction.

Day Ahead

There’s still no fresh key catalysts expected in the coming week. Hence, the JCI is likely to continue to build up upon the success of the break of 4,610 resistance on the back of more FY2013 earnings releases. The Dow’s advance should lend a helping hand for pushing the index again upwards this Tuesday.

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