IHSG Plunges 3% Amid Thin Trading and Global Uncertainty

The Jakarta Composite Index (IHSG) plunged more than 3% on Tuesday, with trading activity remaining thin as investors stayed on the sidelines. The decline was driven by heavy foreign selling and caution ahead of a review by global rating agency S&P, as well as ongoing global uncertainties. By the first trading session, the index had fallen to 5,670, a drop of over 2.5%, with a transaction value of Rp 10.55 trillion. This daily value was significantly below the previous week’s average of Rp 17.58 trillion. Liquidity was highly concentrated, with 61.5% of the total transaction value coming from just two stocks, BBCA and PANI. The largest drag on the index was BBCA, which alone contributed 18.73 points to the decline amid foreign net selling of Rp 413.22 billion in the first session. Overall, foreign investors recorded a net sell of Rp 699.84 billion. Analysts attributed the market weakness to a persistently weak rupiah against the US dollar and investor caution ahead of the release of Indonesia’s inflation data and US employment figures. Additionally, falling global gold prices to around US$3,958 per troy ounce negatively impacted related stocks. Concerns over the potential outcome of the S&P market review and geopolitical tensions in the Middle East further encouraged foreign investors to engage in short-term trading rather than making long-term commitments. Separately, Indonesia Stock Exchange (IDX) President Director Jeffrey Hendrik noted that improving market liquidity cannot rely solely on the growth of retail investors. He emphasised the need for a balanced market structure, including more large-capitalisation listings to attract diverse investor bases and support healthier market dynamics.