Analysis of Factors Affecting the Stock Price Index of the Consumer Goods Industry Sector in the Indonesian Capital Market

Oct 13, 2025 by talynt.org 91 views

Analysis of Factors Affecting the Stock Price Index of the Consumer Goods Industry Sector in the Indonesian Capital Market

Introduction

The Indonesian capital market is a vital component of the country's economy, serving as a platform for the buying and selling of long-term financial instruments, including stocks, bonds, and derivatives. The stock market, in particular, plays a crucial role in facilitating the flow of capital between investors and companies, thereby contributing to economic growth and development. The consumer goods sector, being one of the largest and most dynamic sectors in the Indonesian economy, is of significant interest to investors and market participants.

Background

The capital market is influenced by various macroeconomic factors, including inflation, exchange rates, and interest rates. These factors can have a significant impact on the stock price index (IHS) of the consumer goods sector, making it essential to analyze their effects. This study aims to explore the factors affecting the movement of shares prices for the consumer goods sector in the Indonesian capital market, with a focus on the period from July 2005 to October 2007.

Hypotheses

Based on economic theory, the following hypotheses are formulated:

Inflation has a positive influence on the changes in the JCI in the consumer goods sector.
The rupiah exchange rate has a negative effect on the change in the JCI in the consumer goods sector.
SBI interest rates have a negative influence on the changes in the JCI in the consumer goods sector.

Methodology

This study uses secondary data collected from monthly and annual reports issued by Bank Indonesia, the Central Statistics Agency, and the Jakarta Stock Exchange. The data analysis method employed is multiple regression with Ordinary Least Square (OLS).

Results

The results of the analysis show that the proposed hypotheses are proven to be true.

Inflation has a positive influence on the changes in the JCI in the consumer goods sector. This shows that when inflation increases, stock prices in the consumer goods sector tend to rise. This can be explained because companies in this sector are able to increase the selling price of their products in line with the increasing price of raw materials and production costs due to inflation.
The rupiah exchange rate has a negative effect on the change in the Consumer goods sector. This means, when the rupiah exchange rate weakens, the stock price in the consumer goods sector tends to fall. This is because companies in this sector face the risk of loss due to exchange rate fluctuations.
SBI interest rates have a negative influence on the changes in the JCI in the consumer goods sector. Increasing SBI interest rates can make investors prefer to invest their capital in investment instruments that offer fixed benefits such as deposits, thereby reducing investor interest in investing in stocks.

Further Analysis

The results of this study indicate that macroeconomic factors have a significant influence on the movement of stock prices in the consumer goods sector.

Inflation can be interpreted as a factor that encourages companies to increase the selling price of their products, thereby increasing the profits and value of the company in the eyes of investors.
Exchange rate has a significant influence on companies that import raw materials, thus triggering uncertainty and potential losses.
Interest rate is one of the factors that determine the investment appeal in the stock market.

Conclusion

This study provides an overview of the effect of macroeconomic factors on the movement of JCI in the consumer goods sector. Investors and capital market participants need to pay attention to these factors in making investment decisions. Companies in the consumer goods sector also need to pay attention to macroeconomic dynamics and adaptation strategies to maintain company performance and value.

Implications

The findings of this study have significant implications for investors, companies, and policymakers. Investors need to consider the impact of macroeconomic factors on the stock market when making investment decisions. Companies in the consumer goods sector need to adapt to changing macroeconomic conditions to maintain their performance and value. Policymakers can use the findings of this study to develop policies that promote economic stability and growth.

Limitations

This study has several limitations. The data used is limited to the period from July 2005 to October 2007, and the analysis is based on a single sector, the consumer goods sector. Future studies can expand the data period and include other sectors to provide a more comprehensive understanding of the factors affecting the stock market.

Future Research Directions

Future research can build on the findings of this study by exploring the following directions:

Analyzing the impact of other macroeconomic factors, such as GDP growth and unemployment rates, on the stock market.
Examining the effect of microeconomic factors, such as company-specific factors, on the stock market.
Investigating the relationship between the stock market and other financial markets, such as the bond market and the foreign exchange market.

By exploring these research directions, future studies can provide a more comprehensive understanding of the factors affecting the stock market and contribute to the development of effective investment strategies and policies.
Q&A: Analysis of Factors Affecting the Stock Price Index of the Consumer Goods Industry Sector in the Indonesian Capital Market

Frequently Asked Questions

Q: What is the purpose of this study? A: The purpose of this study is to analyze the factors affecting the movement of shares prices for the consumer goods sector in the Indonesian capital market, with a focus on the period from July 2005 to October 2007.

Q: What are the macroeconomic factors that affect the stock market? A: The macroeconomic factors that affect the stock market include inflation, exchange rates, and interest rates.

Q: How does inflation affect the stock market? A: Inflation can have a positive influence on the stock market, as companies in the consumer goods sector can increase the selling price of their products in line with the increasing price of raw materials and production costs due to inflation.

Q: How does the exchange rate affect the stock market? A: The exchange rate can have a negative effect on the stock market, as companies in the consumer goods sector face the risk of loss due to exchange rate fluctuations.

Q: How does the interest rate affect the stock market? A: The interest rate can have a negative influence on the stock market, as increasing interest rates can make investors prefer to invest their capital in investment instruments that offer fixed benefits such as deposits, thereby reducing investor interest in investing in stocks.

Q: What are the implications of this study for investors? A: The findings of this study have significant implications for investors, as they need to consider the impact of macroeconomic factors on the stock market when making investment decisions.

Q: What are the implications of this study for companies in the consumer goods sector? A: The findings of this study have significant implications for companies in the consumer goods sector, as they need to adapt to changing macroeconomic conditions to maintain their performance and value.

Q: What are the implications of this study for policymakers? A: The findings of this study have significant implications for policymakers, as they can use the findings to develop policies that promote economic stability and growth.

Q: What are the limitations of this study? A: The limitations of this study include the limited data period and the focus on a single sector, the consumer goods sector.

Q: What are the future research directions based on this study? A: Future research can build on the findings of this study by exploring the impact of other macroeconomic factors, such as GDP growth and unemployment rates, on the stock market, and examining the effect of microeconomic factors, such as company-specific factors, on the stock market.

Additional Questions and Answers

Q: What is the significance of this study? A: This study is significant because it provides an overview of the effect of macroeconomic factors on the movement of JCI in the consumer goods sector, and highlights the importance of considering these factors in making investment decisions.

Q: What are the practical implications of this study? A: The practical implications of this study are that investors, companies, and policymakers need to pay attention to the impact of macroeconomic factors on the stock market, and adapt their strategies accordingly.

Q: What are the theoretical implications of this study? A: The theoretical implications of this study are that it contributes to the development of a more comprehensive understanding of the factors affecting the stock market, and highlights the importance of considering macroeconomic factors in investment decisions.

Q: What are the policy implications of this study? A: The policy implications of this study are that policymakers can use the findings to develop policies that promote economic stability and growth, and that investors and companies need to adapt to changing macroeconomic conditions to maintain their performance and value.