Asian Markets in Turmoil, IHSG Reaps the Benefits?

The Indonesian Composite Index (IHSG) closed higher on Friday, defying a sharp downturn in other Asian markets such as Japan and South Korea. The index ended the day up 67.32 points, or 1.1%, at 6,173.53. Market activity was robust, with banking stocks being the primary target for investors. Total trading value reached Rp16.32 trillion, with foreign investors recording a net buy of Rp638.6 billion across the entire market.

Analyst Elandry Pratama from Panin Sekuritas stated it was premature to conclude that a rotation of foreign funds from Japan and South Korea into Indonesia was underway. He noted that the sell-off in those markets was primarily driven by pressure on the global technology sector. However, Pratama acknowledged the possibility of global portfolio rebalancing towards markets with more attractive valuations, including Indonesia.

Echoing this sentiment, Liza Camelia Suryanata, Head of Research at Kiwoom Sekuritas Indonesia, suggested that a shift of funds into Indonesia was plausible. She pointed to expectations of a Bank of Korea interest rate hike as a negative sentiment driver for the South Korean market, which had previously been a top performer. The broader Asia-Pacific sell-off was led by sharp declines in semiconductor and technology stocks.