IHSG strengthens, tracking global markets on US-Iran peace signals
The Jakarta Composite Index (IHSG) on the Indonesia Stock Exchange (BEI) moved higher on Friday, tracking global stock markets amid market optimism over a forthcoming peace agreement between the United States (US) and Iran.
The IHSG opened up 74.38 points, or 1.26 percent, at 5,960.27. Meanwhile, the LQ45 index of 45 leading stocks rose 9.97 points, or 1.70 percent, to 596.81.
Head of Research at Kiwoom Sekuritas, Liza Camelia Suryanata, advised investors and traders not to take on additional buying positions just yet, in order to anticipate potential social unrest or other global and domestic factors over the weekend.
From overseas, US President Donald Trump stated that discussions and final points of a peace deal with Iran had been approved by all relevant parties, and that the signing could take place in the near future. Trump also said the Strait of Hormuz would be reopened once the deal is signed, while the US naval blockade against Iran would be lifted.
Nevertheless, tensions have not fully subsided. The US and Iran were still exchanging attacks as late as Thursday (11/6), while the market remains watchful of risks to global energy supply from the Strait of Hormuz.
Global crude oil prices plunged after Trump cancelled a planned attack on Iran. Brent crude fell 4.5 percent to USD 88.91 per barrel, while WTI dropped 4.2 percent to USD 86.26 per barrel.
European stock markets strengthened after the European Central Bank (ECB) raised interest rates by 25 basis points to 2.25 percent. The ECB revised its inflation projections to 3.0 percent in 2026, 2.3 percent in 2027, and 2.0 percent in 2028, while the Eurozone economic growth forecast was cut to 0.8 percent.
Elsewhere, market participants expect at least one further interest rate hike from the Fed before the end of the year, with focus turning to Kevin Warsh’s first meeting as Fed Chair on 17 June 2026.
“In the short term, global investor attention is also drawn to several major events, such as the USD 75 billion SpaceX IPO, the largest in history, and the start of the FIFA World Cup in the US, which could potentially divert some focus and liquidity towards high-profile assets and sports betting,” said Liza.
Domestically, foreign investors still recorded a net sell of Rp61 billion in Thursday’s trading, bringing the year-to-date accumulated net sell to approximately Rp78.5 trillion.
“The outflow of foreign funds indicates that global investors remain cautious towards Indonesian assets amid high domestic and global uncertainty, including the weakening rupiah, perceived risk issues surrounding Indonesia, and the continuing ‘Sell Indonesia’ trend that has been underway for several months,” Liza added.
Market participants are also monitoring planned student demonstrations in Jakarta today, which risk adding to foreign investors’ concerns about social and political stability in Indonesia.
“As long as these factors persist, foreign fund flows are expected to remain selective and are unlikely to fully return to the Indonesian stock market,” Liza said.
On Thursday (11/6), European bourses closed uniformly higher, with the Euro Stoxx 50 up 0.93 percent, the UK’s FTSE 100 gaining 0.48 percent, Germany’s DAX rising 0.06 percent, and France’s CAC 40 advancing 0.48 percent. Wall Street also ended in positive territory, with the Dow Jones Industrial Average climbing 1.86 percent, the S&P 500 increasing 1.75 percent, and the Nasdaq Composite surging 3.29 percent.
In Asian trading this morning, Japan’s Nikkei index jumped 3.76 percent, China’s Shanghai Composite rose 1.10 percent, Hong Kong’s Hang Seng gained 1.56 percent, and Singapore’s Strait Times added 0.41 percent.