IHSG likely to be volatile amid domestic sentiment and global interest rates

The Indonesia Stock Exchange (IDX) Composite Index (IHSG) is likely to trade in a volatile manner on Thursday, triggered by a combination of domestic sentiment and global interest rate concerns. The IHSG opened down 10.81 points, or 0.18 percent, at 5,873.07. Meanwhile, the LQ45 index of 45 leading stocks fell 1.02 points, or 0.18 percent, to 577.15. “Technically, the IHSG support level is at 5,784, 5,720, or 5,677, while resistance is at 5,993 to 6,052 or 6,171, with a recommended strategy of wait and see or buy on weakness,” said Liza Camelia Suryanata, Head of Research at Kiwoom Sekuritas Indonesia, in her analysis in Jakarta on Thursday. From the global front, Liza explained that investors tend to be cautious while awaiting Micron’s financial report, as the latest indicator for the semiconductor industry outlook and the artificial intelligence (AI) investment theme. “Although technology stocks remain under pressure due to profit-taking and high valuation concerns, market players have not yet shown signs of a massive rotation out of growth stocks,” Liza said. On the other hand, she noted that a significant weakening in oil prices has helped ease inflation worries, reducing expectations of further US Federal Reserve interest rate hikes and supporting investor appetite for risk assets. “The decline in energy prices has prompted investors to trim projections of further rate increases by the Fed, reflected in the fall in US government bond yields,” Liza stated. Meanwhile, geopolitical developments in the Middle East are showing improvement after the United States and Iran resumed implementation of a temporary peace agreement signed last week. Additionally, US and Iranian officials are scheduled to continue technical negotiations in Switzerland next week, with Pakistan and Oman remaining the main mediators in the diplomatic process. “Shipping activity in the Strait of Hormuz has increased again following the reopening of this strategic route, helping to lower the geopolitical risk premium in the energy market,” Liza said. Market focus is now turning to the release of the US core Personal Consumption Expenditures (PCE) inflation data for May 2026, as well as the revised US GDP growth for the first quarter of 2026, which will be important considerations for future monetary policy direction. Domestically, the IDX is preparing for a major transformation into a publicly listed company through a demutualisation scheme based on Law No. 4 of 2026, which opens exchange ownership to the public via private placement and an initial public offering (IPO), targeting a place among the world’s top 10 exchanges within four to five years. Meanwhile, the Ministry of Finance has begun gradually withdrawing excess budget balances (SAL) from state-owned banks (Himbara), from a total of around Rp420 trillion, which previously consisted of approximately Rp300 trillion in Himbara banks and Rp120 trillion at Bank Indonesia (BI). The withdrawal is part of state cash management and state budget financing needs, as well as the result of an agreement with BI to maintain rupiah and financial system stability, with some funds transferred back to the government’s cash account at BI, which provides remuneration, given that the placement of SAL in banks was always temporary. In trading on Wednesday (24/6/2026), European markets were mixed, with the Euro Stoxx 50 down 0.18 percent, the UK’s FTSE 100 up 0.31 percent, Germany’s DAX down 0.62 percent, and France’s CAC 40 up 0.54 percent. Meanwhile, US Wall Street markets were also mixed on Wednesday (24/6/2026), with the Dow Jones Industrial Average up 0.35 percent, the S&P 500 down 0.10 percent, and the Nasdaq Composite down 0.43 percent. Regional Asian stock markets this morning saw the Nikkei index strengthen 3.75 percent to 71,779.00, the Shanghai index rise 0.11 percent to 4,115.84, the Hang Seng index weaken 1.34 percent to 23,098.00, and the Strait Times index gain 0.19 percent to 5,226.43.