IHSG Closes Up 2.07% as US-Iran Peace Deal Optimism Boosts Market Sentiment
The Jakarta Composite Index (IHSG) on the Indonesia Stock Exchange (BEI) closed higher on Friday (12/6), rising 121.63 points or 2.07% to 6,007.66. The rally was driven by growing investor optimism regarding a potential peace deal between the United States and Iran, which boosted market sentiment across the Asian region.
“Positive external factors driving the IHSG’s strengthening include expectations of a peace agreement between the US and Iran, and a correction in crude oil prices below US$90 per barrel,” said Ratna Lim, Head of Research at Phintraco Sekuritas, in Jakarta.
Lim added that domestic sentiment also supported market movement, with investors focusing on the government’s plan to streamline the budget for the Free Nutritious Meals programme and a reduction in the target for the development of the Merah Putih Village Cooperatives by up to 50%.
The LQ45 index of blue-chip stocks also advanced, gaining 10.61 points or 1.81% to 597.45. All ten sectoral indices recorded gains, with the basic materials sector leading the rally, surging 4.19%. The energy and industrial sectors followed, rising 5.03% and 4.17% respectively. The healthcare sector was the sole decliner, falling 2.28%.
Trading activity was robust, with total transactions reaching 2.4 million trades. The volume of shares traded amounted to 37.47 billion, with a total transaction value of Rp21.68 trillion. Advancing stocks outnumbered decliners 615 to 108, while 93 stocks remained unchanged.
Asian markets also closed broadly higher. Japan’s Nikkei index jumped 2.87% to 66,058.00, Hong Kong’s Hang Seng rose 1.93% to 24,718.10, and the Straits Times Index gained 0.76% to 5,025.80. The Shanghai Composite was the outlier, slipping 1.12% to 4,031.51.
Looking ahead, market attention will shift to the Bank Indonesia (BI) Board of Governors meeting scheduled for Thursday (18/6). The market consensus expects the central bank to raise its benchmark interest rate by 25 basis points to 5.75%. Analysts project the IHSG will move within a support range of 5,900-6,000 and a resistance range of 6,150-6,220 next week.