Market View - August 31, 2009

Nikkei surged 2.89% to 10,238 while Shanghai plummeted 3.38% to 2,960 last week. Hangseng fell 0.50% to 20,199, DJIA was up 0.41% to 9,544. Trading was opened by a positive data from US; existing home sales rose 7.16% in July to 5.24 millions and a comment by the Federal Reserve Chairman Ben S. Bernanke that the global economy was beginning to emerge from recession. Speaking of Bernanke, President Obama nominated him for a second term as the Fed’s chairman. Positive reading kept coming as US consumer confidence rose to 54.1 in August and home price index also rose 15.44% in June. However investors worried about the Chinese stocks rally as the Chinese Government said they were not “blindly” optimistic about the economy. Also the Goverment plan to restain production in the steel and cement industries and to increase “guidance” over parts of the coal, glass and power industries. The week ended by another positive data from US. New home sales rose 9.62% to 433,000 in July, durable orders rose 4.9% in July, initial claims fell 1.72% to 570,000 and 2Q GDP fell 1.0% as expected. This week investors will focus on US data such as construction spending (31/8) and unemployment rate (4/9). From domestic, investors will wait for August’s inflation and Rapat Dewan Gubernur Bank Indonesia on Thursday (3/9). Last week JCI added 1.89% gains to 2,377. Our range for JCI this week is 2,362 to 2,386. We see 2,400 would be a short-term resistance and 2,425 as strong resistance. Our picks are Telekomunikasi Indonesia (TLKM, Buy, R-9,100, S-8,350), Indofood (INDF, Buy, R-2,850, S-2,350), Perusahaan Gas Negara(PGAS, Buy, R-3,425, S-3,125), Astra International (ASII, Buy, R-32,000, S-28,000), and Bank Rakyat Indonesia(BBRI, Buy, R-8,250, S-7,150).

Market View - August 27, 2009

Asian markets rose yesterday in response to a better-than-expected US consumer confidence that rose to 54.1 in August, President Obama’s nomination of the Fed Chairman Ben Bernanke for a second term and a better-than-expected German business confidence that rose to 90.5 in August, which was the highest level since September last year. Nikkei surged 142.35 pts (+1.36%) to 10,639, Shanghai advanced 51.79 pts (+1.78%) to 2,967 and Hangseng added 21.08 pts (+0.10%) to 20,456. However, European markets fell due to lower-than-expected result from Swiss Life Holding AG. JCI was slightly down by 0.43 pts (-0.02%) to 2,380. US markets mostly moved flat despite better-than-expected result from new home sales and durable orders. DJIA added 4.23 pts to 9,543 while Nasdaq added 0.20 pts to 2,024. New home sales rose 9.62% to 433,000 in July and durable orders rose 4.9% in July. Asian Development Bank in their latest statement forecasted Indonesia would grow 6% next year. However, the ADB mentioned that Asia, including Indonesia, should expand the domestic demand in response to a weak export outlook. On technical, there is a strong resistance for JCI at 2,400, which is very near to today’s 2nd resistance at 2,399. Indicators such as stochastic and MACD histogram still indicated JCI was on the way up. However, lower metals and oil price could negatively effect our market today. Our range for JCI today is 2,368 to 2,389. Our picks are Telekomunikasi Indonesia(TLKM, Buy, R-8,800, S-8,100), Indofood (INDF, Buy, R-2,850, S-2,350), Jasa Marga (JSMR, Buy, R-1,950, S-1,750), PP London Sumatera (LSIP, Buy, R-9,350, S-7,350), and Indocement Tunggal Prakasa (INTP, Buy, R-11,000, S-9,500).

Market View - August 26, 2009

Asian markets retreated yesterday due to a drop in metals and oil prices. Investors also worried about the Chinese stocks rally as the Government said they were not “blindly” optimistic about the economy. Shanghai plummetted 77.62 pts (-2.59%) to 2,915, Hangseng slid 100.7 pts (-0.49%) to 20,435 and Nikkei was down 83.69 pts (-0.79%) to 10,497. JCI closed at 2,380, posted a 4.64 pts (+0.19%) gains. US market rose after a better-than-expected consumer confidence that rose to 54.1 in August, better than the 47.9 reading market expected. Home price index also rose 15.44% in June. DJIA was up 30.01 pts (+0.3%) to 9,539 while Nasdaq added 6.25 pts (+0.3%) to 2,024. The markets also reacted positively to President Obama’s nomination of the Fed Chairman Ben Bernanke for a second term. JCI traded mostly in negative territory yesterday, and finally managed to stay positive near the end of trading day.Technical indicators indicated a rebound on JCI. Stochastic increased and JCI yesterday managed to closed above MA20. MACD histogram though still below zero line but it increased gradually. Our range for JCI today is 2,360 to 2,391. Our picks are Telekomunikasi Indonesia (TLKM, Buy, R-8,800, S-8,100), Indofood (INDF, Buy, R-2,850, S-2,350), Astra International (ASII, Buy, R-32,000, S-28,000), PP London Sumatera (LSIP, Buy, R-9,350, S-7,350), and Indocement Tunggal Prakasa (INTP, Buy, R-11,000, S-9,500).

Market View - August 25, 2009

Asian markets rose more than 1% yesterday after a positive surprising existing home sales that rose 7.16% in July to 5.24 millions and a comment by the Federal Reserve Chairman Ben S. Bernanke that the global economy was beginning to emerge from recession. Markets also anticipate US consumer confidence to rise to 48 in August and new home sales to rise 1.56% in July to 390,000 units. Hangseng climbed 1.67% (+336.92 pts) to 20,535, Shanghai was up 1.10% (+32.66 pts) to 2,993 and Nikkei surged 3.35% (+342.85 pts) to 10,581. JCI added 1.79% (+41.97 pts) gains to 2,375 led by commodities shares.                                                                                                               Most US markets fell slightly yesterday led by financial companies and profits taking by investors. S&P 500 slid 0.05% (-0.56 pts) to 1,025 while DJIA was up 0.03% (+3.32 pts) to 9,509. Technical indicators started signaling a rebound on JCI. Stochastic increased and JCI yesterday managed to closed above MA20. MACD histogram though still below zero line but it increased gradualy. Our range for JCI today is 2,347 to 2,391. Our picks are Telekomunikasi Indonesia (TLKM, Buy, R-8,800, S-8,100), Indofood (INDF, Buy, R-2,850, S-2,350), Astra International (ASII, Buy, R-32,000, S-28,000), Tambang Batubara Bukit Asam(PTBA, Buy, R-14,800, S-12,800) and United Tractors (UNTR, Buy, R-14,500, S-13,000).

Market View - August 24, 2009

Asian markets took another pullback last week. The week started by a dissapointing results from US housing data last week. Building permits fell 1.75% to 560,000 in July and housing starts fell 1.02% to 581,000. Markets plummeted on Wednesday (19/8) led by China as investors concern the tighter lending would hurt China’s economic growth. Positive economic and manufacturing data from US made markets rebound the next day as US leading indicators rose 0.6% in July and manufacturing in Philadelphia rose to 4.2 in August from -7.5 the month before. However, on Friday (21/8) investors once again worried about China shares as the China Banking Regulatory Commission plan to tighten capital requirements for banks. Nikkei fell 3.39% to ended at 10,597, Hangseng plummeted 3.32% to 20,199, Shanghai plunged 2.82% to 2,960. DJIA was up 1.97% due to surprising existing home sales that rose 7.16% in July to 5.24 millions. This week investors will wait for US consumer confidence (25/8), new home sales (26/6) and 2Q GDP (27/8). Market expect consumer confidence will rise to 48, new home sales to 390,000. 2Q GDP is expected to contract 1.4%. Last week JCI fell 2.22% to 2,333, the first pullback after five weeks rally. We expect the market would be very volatile in this week. Our range for JCI this week is 2,278 to 2,387. Our picks are Telekomunikasi Indonesia (TLKM, Buy, R-8,800, S-8,100), Indofood (INDF, Buy, R-2,625, S-2,200), Astra International (ASII, Sell, R-31,000, S-28,000), Bank Rakyat Indonesia (BBRI, Buy, R-7,450, S-6,800) and Perusahaan Gas Negara(PGAS, Buy, R-3,425, S-3,125).

Market View - August 21, 2009

Asian markets rebound led by Chinese stocks as investors expected the US leading indicators would rise 0.7% in July and existing home sales would jump 2.25% in July to 5 millions. Meanwhile oil price, which rose to $72/barrel as the Energy Department report showed US stockpiles dropped 8.4 million barrels last week, became the positive catalyst for commodities stocks. Shanghai index jumped 4.52% (+126 pts) to 2,911 and Hangseng surged 1.88% (+374.63 pts) to 20,328. Nikkei was up 1.76% (+179.41 pts) to 10,383. JCI rebound by 2.23% (+50.89 pts) to 2,328. The Dow and Nasdaq posted gains as positive data from manufacturing and economic indicators released. DJIA added 0.8% (+70.89 pts) gains to 9,350 while Nasdaq was up 1% (+19.98 pts) to 1,989. US leading indicators rose 0.6% in July, slightly below market expectations. Manufacturing in Philadelphia rose to 4.2 in August from -7.5 the month before. We reiterate our view that JCI is in its pullback period and we expect the market would be very volatile in the next few days. Stochastic and MACD indicate no positive signal for JCI to rebound. One positive sign is that yesterday JCI closed slightly above MA20. Our range for JCI today is 2,295 to 2,346. Our picks are Telekomunikasi Indonesia (TLKM, Sell, R-8,800, S-8,100), Indofood (INDF, Sell, R-2,625, S-2,200), Astra International (ASII, Sell, R-31,000, S-28,000), Bank Rakyat Indonesia (BBRI, Buy, R-7,450, S-6,800) and Perusahaan Gas Negara(PGAS, Sell, R-3,425, S-3,125).

Market View - August 20, 2009

Global markets plummeted yesterday led by China as investors concern the tighter lending would hurt China’s economic growth. The Shanghai Index plunged 4.3% (-125.30 pts) to 2,785 while Hangseng fell 1.73% (-352.04 pts) to 19,954. Nikkei slid 0.79% (-80.96 pts) to 10,204. Lower commodities prices dragged JCI down by 2.53% (-59.23 pts) to 2,277. US markets rebound after oil climbed to $72/barrel as the Energy Department report showed US stockpiles dropped 8.4 million barrels last week. DJIA gained 0.7% (+61.22 pts) to 9,279 while Nasdaq added 0.7% (+13.32 pts) to 1,969. Technical indicators such as stochastic, OBV and MACD confirm JCI is in a pullback period. Yesterday JCI closed around its MA20. Our third support today is at 2,140, slightly below a 61.8% fibonacci retracement at 2,170. We still view our market would take another pullback and it would be quite volatile. Our range for JCI today is 2,248 to 2,328. Our picks are Telekomunikasi Indonesia (TLKM, Sell, R-8,800, S-8,100), Indofood (INDF, Sell, R-2,625, S-2,200), Astra International (ASII, Sell, R-31,000, S-28,000), Bumi Resources (BUMI, Sell, R-3,225, S-2,850) and Perusahaan Gas Negara(PGAS, Sell, R-3,425, S-3,125).

Market View - August 19, 2009

Most Asian markets rebound yesterday as European markets were opened in a positive tone. Investors bet that German’s investor confidence, US’s building permits and housing starts will rise. Nikkei was up 16.35 pts (+0.16%) to 10,284 and Hangseng added 168.62 pts (+0.84%) to 20,306. JCI fell 49.88 pts (-2.09%) to 2,336. US market also rebound after Monday’s selloff. DJIA added 82.60 pts (+0.9%) to 9,217 and Nasdaq rose 25.08 pts (+1.3%) to 1,955 as better-than-expected earnings from Home Depot and Target Corp. However, data from building permits and housing starts were below market expectation. Building permits fell to 560,000 in July from 570,000 the month before and housing starts fell to 581,000 from 587,000. Rebound in global markets in our opinion will become a positive catalyst for JCI today. However, we still think market will be very volatile this week and is opened to correction. Technical indicators such as stochastic and MACD start indicating a pullback. Our strong support for JCI is at 2,170 which is also a 61.8% fibonacci retracement. Our range for JCI today is 2,293 to 2,381. Our picks are Tambang Batubara Bukit Asam (PTBA, Buy, R-14,800, S-11,000), Int’l Nickel Indonesia(INCO, Buy, R-5,350, S-4,050), Astra International (ASII, Sell, R-30,000, S-27,200), Aneka Tambang (ANTM, Buy, R-2,875, S-2,150) and Ciputra Development (CTRA, Buy, R-850, S-740).

Market View - August 18, 2009

Market was open in a positive mode last week in response to promising data from US unemployment rate Japan machinery orders. China’s retail sales expanded and UK housing market showed improvement in July while US productivity rose 6.4% in 2Q. However, Asian market took a pullback on Wednesday (12/8) as investors worried that China’s stimulus package could not completely offset slumping export demand. Market rebounded the next day as the Federal Reserve expressed their positive outlook that the recession was easing. The Fed also kept their rate at 0.00% to 0.25%. US Retail sales unexpectedly fell 0.1% in July and initial claims rose 0.72% to 558,000. Meanwhile the German and French economy grew 0.3% each in the 2Q from the 1Q. Last week DJIA fell 0.52% to 9,321. Hangseng surged 2.54% to 20,893 and Nikkei added 1.58% to 2,386. JCI was up 1.58% to 2,386 last week. Our GDP rose 4% yoy in the 2Q, a little bit lower than the 1Q’s 4.4% yoy. Morgan Stanley revised our economic growth in 2009 from 3.7% to 4.4% and 2010 from 5.0% to 5.5%. On political issue, the Constitutional Court rejected an appeal by by JK-W and Mega-Pro. Altough indicators such as OBV and stochastic show a bullish pattern, however a decrasing MACD histogram triggers a warning that JCI would take a pullback. It is likely JCI will take a correction to its 61.8% fibo at 2,170. Our range this week is 2,356 to 2,408. Our picks are Indofood (INDF, Buy, R-2,850, S-2,300), PP London Sumatera (LSIP, Buy, R-8,900, S-6,900), Astra International (ASII, Sell, R-30,000, S-27,200), Aneka Tambang (ANTM, Buy, R-2,875, S-2,150) and Telekomunikasi Indonesia(TLKM, Sell, R-9,100, S-8,400).

Market View - August 14, 2009

Asian markets rose yesterday as investors reacted positively on the Federal Reserve’s comment that the recession was easing. Hangseng surged 426.06 pts (+2.08%) to 20,861 and Nikkei was up 82.19 pts (+0.79%) to 10,517. European markets also rose as the German and French economy grew 0.3% each in the 2Q from the 1Q. JCI rose 49.13 pts (+2.09%) yesterday to 2,396 led mostly by commodities stocks. DJIA only added 36.58 pts (+0.4%) to 9,398 and Nasdaq was slightly up by 10.63 pts (+0.5%) due to mix data from Walmart, retail sales and initial claims. Walmart posted a 2Q profit of 88 cents per share, 2.33% higher than markets estimate. However, this positive result was overshadowed by dissapointing results from retail sales and initial claims. Retail sales unexpectedly fell 0.1% in July while market expected a 0.8% rise. Initial claims also rose 0.72% to 558,000 last week while market expected it could lower to 545,000. Positive results from German and French economy, together with the Fed’s outlook, in our opinion will boost investors’ confidence. The Bloomberg Professional Global Confidence Index jumped to 58.12 in August, from 39.13. Indicators such as OBV and stochastic show a bullish pattern. However, a decrasing MACD histogram triggers a warning that JCI could take a pullback. We forecast JCI will test its 76.4% fibonacci retracement at 2,425 and if it fails, JCI will retrace to its 61.8% fibo at 2,170. Our range for JCI today is 2,359 to 2,420 and our picks are Indofood(INDF, Buy, R-2,850, S-2,300), PP London Sumatera (LSIP, Buy, R-8,900, S-6,900), Ciputra Development (CTRA, Buy, R-850, S-740), Aneka Tambang (ANTM, Buy, R-2,875, S-2,150) and Timah (TINS, Buy, R-2,450, S-2,075).

Market View - August 13, 2009

Asian markets sank as investors worried the recent rally had made stocks expensive, especially after several companies posted a worse than expected results yesterday. Hangseng plunged 638.97 pts (-3.03%) to 20,435 after Great Wall Motor Co., China’s largest maker of pick up trucks, posted a 36% drop in 1H profit. Shanghai slid 83.43 pts (-2.6%) to 3,181 after the commerce ministry said the stimulus package cannot completely offset slumping export demand. Nikkei dropped 150.46 pts (-1.42%) to 10,435 as investors worried a stronger yen would hurt overseas profits for automakers such as Honda Motor Co. JCI declined by 51.92 pts (-2,16%) to 2,347. DJIA surged 120.16 pts (+1.3%) to 9,361 and Nasdaq was up 28.99 pts (+1.5%) to 1,998 after a positive outlook from the Federal Reserve, which said the recession is easing. The Fed also kept their rate at 0.00% to 0.25%. JCI declined to 2,347 yesterday, near to our 1st support at 2,324 based on JCI’S weekly chart. If the pullback continue our 2nd support will be 2,299. Our 1st resistance is at 2,367 and 2nd resistance is at 2,385. One critical point is our 3rd resistance at 2,428 which is very close to a 76.4% fibonacci retracement (2,425). Yesterday the Constitutional Court rejected an appeal by by JK-W and Mega-Pro. Our range for JCI today is 2,316 to 2,389 and our picks are Indofood(INDF, Buy, R-2,850, S-2,300), Tambang Batubara Bukit Asam(PTBA, Sell, R-14,800, S-11,000), Astra International (ASII, Buy, R-36,300, S-30,000), Aneka Tambang (ANTM, Buy, R-2,875, S-2,150) and Timah (TINS, Buy, R-2,450, S-2,075).

Market View - August 12, 2009

Asian markets posted gains yesterday as China’s retail sales expanded and UK housing market showed improvement in July. Nikkei was up 61.2 pts (+0.58%) to 10,585, Hangseng added 144.7 pts (+0.69%) to 21,074 and Shanghai posted a 14.97 pts (+0.46%) gains to 3,264. JCI was up 9.71 pts (+0.41%) to ended at 2,399. DJIA slid 96.5 pts (-1.0%) to 9,241 while Nasdaq slid 22.5 pts (-1.1%) to 1,969 led by financial stocks after JPMorgan downgraded MBIA Inc to underweight and CIT Group delayed its quarterly filing. US productivity rose 6.4% in 2Q, better than the 5.5% market expected. Indicators such stochastic and MACD still show a bullish signals on JCI and its increasing volume confirms the signal. In our opinion JCI will try to break out our second resistance at 2,425 in the next few days, which also a 76.4% fibonacci retracement. Morgan Stanley revised our economic growth in 2009 from 3.7% to 4.4% and 2010 from 5.0% to 5.5%. Our range for JCI today is 2,378 to 2,412 and our picks are Indofood(INDF, Buy, R-2,850, S-2,300), Bank Rakyat Indonesia (BBRI, Buy, R-8,000, S-7,100), Astra Agro Lestari (AALI, Buy, R-27,300, S-18,700), Aneka Tambang (ANTM, Buy, R-2,875, S-2,150) and London Sumatera (LSIP, Buy, R-8,100, S-6,900).

Market View - August 6, 2009

Asian stocks fell yesterday after a dissapointing results from Isuzu Motors and Elpida Memory. Positive news from UK’s consumer confidence that rose to 60 could not help Asian markets. Nikkei plunged 122.48 pts (-1.2%) to 10,252 and Hangseng plummeted 301.66 pts (-1.5%) to 20,494. JCI fell 43 pts (-1.82%) to 2,317. US stocks fell after worse-than-expected report on job losses and service industries. DJIA fell 39.22 pts (-0.4%) to 9,280 and Nasdaq fell 18.26 pts (-0.9%) to 1,993. ADP Employer Services showed companies cut 371,000 workers in July, more than the 350,000 cut market expected. Meanwhile, the ISM’s index of service busineses fell to 46.4 in July from 47 the month before. Market expected ISM services will rise to 48. Bank Indonesia cut its BI Rate by 25 bps to 6.5% as expected. However, BI also indicated that further cuts might be unwarranted as inflation was expected to rise next year. Based on technical, JCI took a pullback after a three-weeks rally. Using fibonacci, we have a 76.4% retracement at 2,425 as our strong resistance and 61.2% retracement at 2,170 as a strong support. We expect another pullback in the coming days because of valuation play. Our range for JCI today is 2,296-2,350 and our recommendations are Tambang Batubara Bukit Asam (PTBA, Buy, R-14,800, S-11,000), Astra International (ASII, Sell, R-30,000, S-27,200), Adaro Energy (ADRO, Buy, R-1,450, S-1,260), Int’l Nickel Indonesia(INCO, Buy, R-5,350, S-4,050) and Indofood (INDF, Sell, R-2,300, S-1,730).

Market View - August 5, 2009

Asian markets ended mix yesterday as futures on US market fell into negative territory despite positive results from manufacturing index and construction spending. Nikkei added 22.54 pts (+0.22%) to 10,375 while Hangseng fell 10.83 pts (-0.05%) to 20,796. Higher oil and metal prices became the catalyst as market expected economic recovery. JCI added 21.29 pts (+0.91%) to 2,360 led mostly by commodity stocks. DJIA added 33.63 pts (+0.4%) to 9,320 as pending home sales rose 3.6% in June, higher than the +0.7% market expected. On corporate news, Caterpillar Inc. increased their earnings outlook from $8/share to $10/share in 2012. Japanese stocks opened positive this morning as Toyota Motor Corp. raised its outlook.                         Based on technical, JCI broke out its 61.8% fibonacci retracement at 2,170 and now tries to break out its 76.4% fibo retracement at 2,425. JCI’s weekly chart forms a soucer shape with its neckline at 2,556. If JCI breaks out 76.4% fibo retracement then it is possible JCI moves to 2,556 which is also this week’s third resistance. Bank Indonesia is expected to cut BI Rate by 25 bps to 6.5% today as inflation fell to 2.71% yoy in July, lower than June’s 3.65% yoy. Our range for JCI today is 2,339-2,382 and our picks are Tambang Batubara Bukit Asam (PTBA, Buy, R-14,800, S-11,000), Astra International (ASII, Buy, R-32,400, S-30,000), Adaro Energy (ADRO, Buy, R-1,450, S-1,260), Bank Rakyat Indonesia (BBRI, Buy, R-8,000, S-6,500) and Jasa Marga (JSMR, Buy, R-1,940, S-1,680).

Market View - 4 August 2009

Most Asian stocks rose yesterday as encouraging comments came from Alan Greenspan and Nouriel Roubini. The New York University economist Nouriel Roubini, known as Dr. Doom, said that commodity prices may extend their rally in 2010 as the global recession abates. Earlier before, the former Federal Reserve Chairman Alan Greenspan said the recession might be ending. Nikkei slid slightly 4.36 pts (-0.04%) to 10,352 while Hangseng surged 233.93 pts (+1.14%) to 20,807. JCI added 15.56 pts (+0.67%) to 2,338. DJIA surged to 9,286, the highest level in 2009, posted a 1.3% (+114 pts) gain as positive results from manufacturing index, construction spending and China’s Purchasing Managers’ Index. Manufacturing index rose to 48.9 in July from 44.8 in June while construction spending rose 0.3% in June from -0.8% in May. China’s PMI rose to 52.8 in July, the hishest level in 2009, from 51.8 in June.                         The Central Statistics Bureau announced consumer prices rose 0.45% (mom) in July, or 2.71% yoy, lower than June’s 3.65% yoy. Lower inflation opened room for Bank Indonesia to cut BI Rate by 25 bps to 6.5% this Wednesday (5/8) on Rapat Dewan Gubernur BI. Our range for JCI today is 2,324-2,351 and our picks are Indofood (INDF, Buy, R-2,850, S-2,300), Astra International(ASII, Buy, R-32,400, S-30,000), Perusahaan Gas Negara (PGAS, Buy, R-3,875, S-3,425), Int’l Nickel Indonesia (INCO, Buy, R-5,350, S-4,050) and Jasa Marga (JSMR, Buy, R-1,810, S-1,680).

Market View - 03 August 2009

It was another positive week for Asian markets last week despite Wednesday (29/7) selloff from China’s market. Nikkei surged 4.14% to 10,356 last week while Hangseng ended at 20,573, added a 2,96% gain. DJIA was slightly up 0.86% to 9,171. Data from US showed that the pace of economic decline slowed as mention in the Fed’s beige book. New home sales jumped 10.98% in June to 384,000 while initial claims reached 584,000 last week. 2Q GDP contracted 1%, better than the -1.5% market expected. However, US consumer confidence dropped to 46.6 in July, lower than June’s 49.3 reading. In Japan, factory output rose 2.4% in June. This week markets will wait for several US economic data such as construction spending (3/8), factory orders (5/8) and unemployment rate (7/8). Markets expect construction spending will contract 0.6% in June, better than May’s -0.9% while factory orders is expected to rise 0.5% in June, lower than May’s 1.2%. Markets also prepare for another high unemployment rate at 9.6% in July.                                                              JCI surged 6.32% last week, ended at 2,323. Bakrie’s shares and banking stocks led our market. For this week we forecast JCI will be in a 2,231 to 2,369 range. One positive catalyst for JCI would be a lower inflation. BPS forecast month on month inflation in July could be as low as 0.2%-0.5% and year on year at 3%. Our picks for this week are Tambang Batubara Bukit Asam (PTBA, Buy, R-14,000, S-11,000), Astra International (ASII, Buy, R-32,400, S-27,200), Bank Mandiri (BMRI, Buy, R-4,625, S-3,600), United Tractors (UNTR, Buy, R-13,500, S-11,500) and Bumi Resources (BUMI, Buy, R-3,500, S-2,300).