Financial practitioner attributes IHSG weakening to dividend distribution
Jakarta (ANTARA) - Financial consultant and planner Elvi Diana, CFP, stated that the weakening of the Composite Stock Price Index (IHSG) throughout the previous week was inseparable from several technical and fundamental market factors, one of which was the momentum of dividend distributions by a number of issuers.
The Indonesia Stock Exchange (BEI) recorded that the IHSG closed in negative territory during the trading week of 27–30 April 2026, correcting by 2.42 percent to the level of 6,956.80, down from the previous week’s closing position at 7,129.49.
“Dividend distributions often cause a mechanical decline in share prices on the ex-dividend date or ex-date, equivalent to the amount of the cash dividend distributed,” said Elvi Diana in an official statement received in Jakarta on Tuesday.
“This occurs because the company’s cash decreases, while new investors who buy shares after that date are no longer entitled to the dividend,” she continued.
She explained that this situation often triggers profit-taking actions by investors, as well as market price adjustments that exert overall pressure on the IHSG.
In addition to the dividend factor, Elvi said that market sentiment and global dynamics also influenced the IHSG’s movements over the past week, although domestic factors remain the main drivers.
She also called on the Financial Services Authority (OJK) to take anticipatory steps to maintain the stability of the national capital market.
She emphasised the importance of adaptive and responsive policies towards market dynamics, including strengthening investor literacy regarding dividend mechanisms and share price volatility.
“OJK needs to ensure that market participants understand that the price decline on the ex-date is a technical phenomenon, not merely reflecting a decline in the issuer’s fundamental performance,” said Elvi.
She also suggested increased supervision of potential excessive volatility and strengthened public communication to prevent panic among retail investors.
“With the right anticipatory steps, it is hoped that market stability can be maintained and investor confidence in the Indonesian capital market remains strong amid the occurring dynamics,” she said.
On Tuesday morning, the IHSG opened weaker by 3.38 points or 0.05 percent to the position of 6,968.57. Meanwhile, the group of 45 leading stocks or LQ45 Index fell by 0.80 points or 0.12 percent to the position of 673.76.
However, the IHSG closed stronger on Tuesday afternoon, supported by gains in stocks from the banking and conglomerate sectors.
The IHSG closed up 85.16 points or 1.22 percent to the position of 7,057.11. Meanwhile, the group of 45 leading stocks or LQ45 Index rose by 7.02 points or 1.04 percent to the position of 681.58.