THE INFLUENCE OF DOW JONES INDEX, NIKKEI INDEX, HANG SENG INDEX, EXCHANGE RATE ON IDR, BI INTEREST RATE AND INFLATION TOWARDS JAKARTA COMPOSITE INDEX PERIOD 2010 – 2013

Abstract

Jakarta Composite Index (JCI) is an index that used by Indonesia Stock Exchange to reflect the fluctuation all of the listed stocks in Indonesia Stock Exchange that currently happen in Indonesia capital market. Jakarta Composite Index are the reflection of the movement of the Indonesia capital market that are influenced by many factors. In this research, the independent variables used divided into two factors that has significant influence toward Jakarta Composite Index which are foreign market index and macroeconomic variables. Foreign market index that could have significant influence toward Jakarta Composite Index consist of Dow Jones Index, Nikkei Index and Hang Seng Index. While macroeconomic variables that could has significant influence toward Jakarta Composite Index consist of Exchange Rate on IDR, BI Interest Rate and Inflation. This research is a quantitative research that will analyze the influence of foreign market index and macroeconomics variables towards Jakarta Composite Index. The sample for this research is 46 sample for each variables which is monthly secondary data and the time period for this research is from January 2010 – October 2013. This research use SPSS version 18 and EViews 6 as the statistical tools. The result of this study is partially all of the factors has influence toward Jakarta Composite Index, but only Dow Jones Index, Exchange Rate on IDR and BI Interest Rate that have significant influence. Simultaneously all of the factors have significant influence toward Jakarta Composite Index with adjusted R-square 0.891 or 89 % of the factors in this multiple regression models can explain the dependent variable, while the remaining explained by the other factors outside this multiple regression model.