Israel-Iran War Threatens Indonesian Stock Exchange Shake-up: What Should Retail Investors Do?
JAKARTA – The Iran-Israel war, which has drawn the United States into the conflict spiral, threatens to shake global financial markets, including Indonesia.
The Composite Stock Price Index (IHSG) is considered vulnerable to correction in the short term. Amid this uncertainty, retail investors face a crucial question: should they hold, exit, or seize opportunities?
Market observer Reydi Octa believes the Iran-US conflict risks triggering further geopolitical pressure on global and domestic markets. The tension has driven world oil prices up sharply due to concerns about disruptions to energy supplies from the Middle East.
“The Iran-US conflict could subject global and domestic capital markets to renewed geopolitical risk pressure. The tension is driving world oil prices sharply upward because of concerns over supply disruptions, which triggers inflation and increases market volatility,” Reydi told Kompas.com on Sunday (1 March 2026).
Concerns over conflict escalation have prompted global investors to redirect funds towards assets considered safer, such as gold and bonds. This capital flight is putting pressure on equity markets, including the IHSG, which in the short term tends to move downwards.
Pressure emerges from market participants’ selling actions, outflows of foreign capital from emerging markets, and rising global risk-off sentiment.
“The IHSG tends to correct due to selling actions, foreign capital outflows, and rising global risk sentiment,” he explained.
Conversely, if tensions continue to escalate and trigger prolonged uncertainty, market volatility could deepen with sustained pressure on the index.
In such a situation, investors are advised to secure a portion or even all of their funds to maintain liquidity. This step is important so that investors have the flexibility to seize opportunities when the IHSG corrects and equity valuations become more attractive.
“If the war continues, volatility will deepen with sustained pressure on the index. Investors should secure a portion or all of their funds to capitalise on opportunities when the index corrects,” Reydi said.
According to him, not all market conditions require aggressive action, but rather responses should be tailored to each investor’s individual risk profile.
“For retail investors, the best approach is discipline and selectivity. If you have an aggressive profile, momentum in the commodities sector can be leveraged with strict risk management,” he said.