IDX Composite Plummets to 5-Year Low: Heading Back to Pandemic Levels?

The Indonesia Composite Index (IHSG) plummeted during trading on Wednesday (3/6/2026). By the end of the first session, the index had dropped by nearly 5%, losing 306 points in a single session. Specifically, the IHSG slumped 4.94% to the level of 5,889.48.

This weakening has brought the IHSG to its lowest price in five years. The last time the index closed below today’s trading level was in May 2021, a period when the market was rebounding following the pandemic-induced crash of 2020. During today’s session, only 35 stocks gained, while 714 stocks—nearly all actively traded issuers on the exchange—moved into the red zone. Transaction value during the first session was high, approaching Rp 15 trillion.

Conglomerate-owned companies and blue-chip stocks fell in unison, acting as the primary drags on the IHSG’s performance. Previously, during the prior trading session, the index had received a boost from significant gains in conglomerate groups, particularly the Barito Group owned by Prajogo Pangestu. These conglomerate stocks, which served as the primary drivers for the IHSG’s strength from 2023 through the end of 2025 and helped the domestic index hit multiple all-time highs, have now collectively declined.

Severe warnings from global index providers, ranging from MSCI to FTSE, have punctured the bubble of Indonesian stocks whose prices had become excessively high and arguably illogical. Some of these stocks featured price-to-earnings ratios exceeding 500 times, with some even surpassing 1,000 times earnings. Furthermore, ownership concentration in certain stocks has become a concern, with reports suggesting that a passive fund manager is unable to trade certain stocks included in the prestigious MSCI index.

These factors have led global index providers to reconsider the investment viability of the Indonesian stock exchange. Consequently, regulators, Self-Regulatory Organisations (SROs), and other policymakers have moved swiftly to address these issues. However, to date, these efforts have only provided a superficial lift to the IHSG, as the index continues to erode and descend to its five-year low.

Furthermore, this decline is even lower than the IHSG’s pre-pandemic peak of 6,693. This year’s rate of correction indicates that the IHSG is moving backwards rather than forwards, with nearly all the gains achieved since the post-pandemic economic recovery evaporating. For context, the IHSG’s lowest point during the pandemic peak closed at 3,937 on 24 March 2020. The all-time high was recorded on 20 January 2026 at 9,134. Over nearly six years, the IHSG managed a 132% increase, and from its pre-pandemic peak, it had risen by 36%.

Currently, the IHSG remains under intense pressure and is in a state of continuous sharp decline. A major question remains for investors: how long will this slump last, and has the index reached its bottom, or is it headed towards the lows seen during the pandemic?