IHSG Closes Higher Ahead of Weekend, Tracking Asian Regional Gains
The Jakarta Composite Index (IHSG) of the Indonesia Stock Exchange (BEI) closed higher on Friday afternoon, tracking gains in Asian stock markets. The IHSG closed up 131.22 points, or 2.28 percent, at 5,875.78. Meanwhile, the LQ45 index of 45 leading stocks rose 16.29 points, or 2.88 percent, to 581.78.
Associate Director of Research and Investment at Pilarmas Investindo Sekuritas, Maximilianus Nico Demus, stated that ahead of the weekend, global sentiment provided a positive catalyst for the IHSG’s strengthening. From abroad, geopolitical developments in the Middle East contributed, with Qatar as mediator reporting positive progress in peace mediation between the United States and Iran to end the four-month conflict. The Qatari Ministry of Foreign Affairs stated that discussions on a memorandum for a ceasefire in June 2026 were proceeding constructively. However, market participants remain cautious as there is no written agreement guaranteeing long-term peace in the region.
Additionally, positive sentiment came from slowing US labour market data. US nonfarm payrolls for the period of June 2026 increased by only 57,000, below the estimate of 110,000, while the unemployment rate stood at 4.2 percent, lower than the forecast of 4.3 percent. The release of slowing US labour market data provided a new perspective for market participants, who are speculating that the Federal Reserve will not raise its benchmark interest rate in the near term. Based on CME Fedwatch, the probability of a Fed rate hike in September 2026 is only around 45.6 percent, down from 67 percent before the employment report was released.
Domestically, the government and the House of Representatives have agreed on the initial posture of the 2027 State Revenue and Expenditure Budget Draft as the basis for drafting the Financial Note and the State Budget Bill. The state revenue ratio is targeted at 12.01 to 12.40 percent of GDP, with tax revenue reaching 10.08 to 10.45 percent of GDP. Meanwhile, state expenditure is set in the range of 13.82 to 14.20 percent of GDP, resulting in an estimated budget deficit of 1.8 to 2.2 percent of GDP. This posture reflects the government’s effort to maintain a balance between fiscal discipline and the need to drive economic growth.
The IHSG opened higher and remained in positive territory until the close of the first trading session. In the second session, the IHSG stayed in the green until the end of trading. Based on the IDX-IC sectoral indices, all eleven sectors strengthened, led by the industrial sector which rose 3.74 percent, followed by the basic materials and infrastructure sectors which rose 2.97 percent and 2.36 percent, respectively. Stocks experiencing the largest price gains included KOKA, FUTR, ECII, COCO, and RMKO, while stocks experiencing the largest declines were BOBA, JECC, INPP, RANC, and KBLI. Trading frequency was recorded at 1,363,000 transactions, with 17.15 billion shares traded, valued at Rp10.53 trillion. A total of 520 stocks rose, 159 fell, and 280 were unchanged.
Regional Asian bourses also closed higher, with the Nikkei index rising 1.47 percent to 69,744.07, the Shanghai index up 0.37 percent to 4,034.64, the Kuala Lumpur index strengthening 1.04 percent to 1,679.05, the Shenzhen index gaining 0.76 percent to 2,792.58, and the Strait Times index increasing 0.26 percent to 5,230.87.