Jakarta. Not only in the US, Indonesia’s stock market is likely to be in favor of Hillary Clinton to be the next president of the US (the United States of America). KONTAN estimates that stock exchange will be more vibrant if the candidate of Democrat Party wins the US presidential election.

The global market moved in positive zone after the FBI (Federal Bureau of Investigations) found no criminal wrongdoing in Clinton’s use of her emails for sending official documents. “The US stock market has rebounded after being suppressed during the previous eight days”, said analyst at Semesta Indovest Aditya Perdana Putra.

However, Head of Research at Koneksi Kapital Alfred Nainggolan said that the US presidential election will have no significant impact to the Jakarta Composite Index (JCI). “Our index tends to increase, while the market was dominated by the solid macro fundamentals”, Alfred said.

However, the US presidential election will become a sentiment to drive the index. Therefore, investors are suggested to prepare strategies in facing the impacts of the political event.

Analyst at NH Korindo Muhammad Ikhsan predicted that Clinton is likely to adopt Obama’s policies if she is elected. This will allow market players to predict the prospect of the US economy. In other words, market will have more certainty if Clinton wins the election.

Aditya estimated that Trump actually has an advantage of his background as an entrepreneur. However, he often makes controversial statements, which have potentials to trigger conflict. “Market dislike the conflict”, he said.

Ikhsan also said that some of the discourses of Trump’s policies may interrupt the stability of the US economy. The unstable US economy will affect to the bond and equity market.

However, the pressure will have insignificant impact to JCI, as the effect of the presidential election will only be temporary. “Probably, JCI will decrease by only 5% if Trump wins, since we are still in the period of bullish”, said Investment Director of Sucorinvest Asset Management Jemmy Paul Wawointana.

Furthermore, the fundamentals of Indonesia’s economy are still able to neutralize the pressures from abroad. If Clinton wins, Jemmy recommends buy of blue chip shares, mainly the blue chip shares of banking sector, ASII, and consumer goods, such as cigarettes.

Meanwhile, Ikhsan favors the shares of LPPF. In banking sector, Ikhsan recommends buy of BBRI, BMRI, and BBCA shares, while in mining sector he recommends buy of PTBA shares. However, banking sector is still affected by negative sentiment of the issue related to the Deutsche Bank.

It is predicted that mining sector will remain prospective if Trump wins, on the grounds that the biggest sentiments of the mining sector are derived from commodities prices.

The commodities prices may increase if Trump wins, on the grounds that the market players will see the safe haven assets. “Mining sector may be a choice, while waiting other sectors go to the level of buy on weakness”, Ikhsan said.

Vice President for Research at Valbury Asia Securities Nico Omer said that the shares of gold mining issuers, such as PSAB and MDKA will be attractive if Trump wins. Trump himself will be blamed if he wins and the economy fluctuates.

Stock exchange will be suppressed if the economy fluctuates. “Gold price will move in opposite direction against the index movement, as gold is a safe haven (asset)”, Nico added.

(MUHAMMAD FARID/Translator)

Editor: Adi Wikanto