Rupiah and JCI Face Severe Test from the US Today, What's Next?

Indonesia’s financial markets are expected to remain volatile in trading today, Thursday (25/6/2026). The Jakarta Composite Index (JCI) plunged deeply in trading on Wednesday, after MSCI maintained Indonesia’s capital market in the Emerging Market category but still provided a number of notes. At the end of the second session, the JCI plummeted 3.56%, or 217 points, to 5,883.88. Throughout trading, the JCI moved in the range of 6,171 to 5,876. The transaction value on Wednesday reached Rp15.15 trillion, with a trading volume of 26.94 billion shares in 2.03 million transactions. In terms of stock movement, 98 stocks strengthened, 611 stocks weakened, and 104 stocks were stagnant. This condition indicates that selling pressure occurred quite broadly in the domestic stock market. Citing Refinitiv data, all trading sectors ended in the red zone. The deepest corrections were recorded by the basic materials, energy, and health sectors. Large-cap blue chip stocks and stocks affiliated with conglomerate business groups also weakened significantly. Specifically, the stocks that were the main drag on the JCI’s performance were PT Mora Telematika Indonesia Tbk (MORA), BBRI, BBCA, PT Bumi Resources Minerals Tbk (BRMS), BMRI, PT Amman Mineral Internasional Tbk (AMMN), PT Sinar Mas Multiartha Tbk (SMMA), PT Barito Pacific Tbk (BRPT), PT Energi Mega Persada Tbk (ENRG), and PT Bumi Resources Tbk (BUMI). Pressure on the JCI occurred after MSCI released the results of the MSCI 2026 Market Classification Review. Indonesia was indeed retained in the Emerging Market category, but MSCI still highlighted a number of issues, especially regarding share ownership transparency, free float, and alleged manipulation of coordinated trading. In the foreign exchange market, the rupiah exchange rate again ended Wednesday’s trading with a correction against the US dollar. The pressure occurred amid a strengthening trend of the US dollar in global markets. Throughout Wednesday’s trading, the rupiah moved in the range of Rp17,900-Rp17,955 per US dollar. This movement made the rupiah heat up again as it gets closer to the psychological level of Rp18,000 per US dollar. The strengthening of the US dollar in the global market remains the main factor depressing the rupiah exchange rate. The greenback’s strengthening makes the room for movement of other countries’ currencies, including the rupiah, increasingly limited. The US dollar continued to strengthen to its highest level in more than a year. The strengthening occurred along with adjustments in market expectations towards the direction of the US central bank’s (The Federal Reserve/The Fed) policy, which is considered increasingly hawkish. The Fed’s policy meeting, or the Federal Open Market Committee (FOMC), last week, which was the first meeting under Fed Chair Kevin Warsh, was read by the market as a signal that the US central bank is still opening room for an interest rate hike this year. Expectations for a Fed rate hike have also increased sharply. Based on CME FedWatch, the probability of a rate hike of at least 25 basis points at the July meeting rose to 36.3%, from 8.5% a week earlier. Meanwhile, the probability of a rate hike at the September meeting rose to 69.1%, from 29.1% a week earlier. From the bond market, the yield on the 10-year government bond (SBN) weakened 0.71% to 7.167% in trading on Wednesday. The decline in yield indicates that SBN prices are rising. This condition usually reflects buying action in the bond market, as yields and bond prices move in opposite directions. From the United States stock market, Wall Street closed mixed in trading on Wednesday, or early Thursday morning Indonesian time. Stocks closed varied amid a sell-off in technology stocks led by the weakening of Micron Technology shares. Market participants are now awaiting the financial report of the memory chip maker, which is scheduled to be released after the market close. The Nasdaq Composite index weakened 0.43% to 25,476.64. Meanwhile, the S&P 500 fell slightly by 0.10% to 7,358.22. In contrast to the two indices, the Dow Jones Industrial Average actually rose 182.06 points, or 0.35%, to 51,848.90. Oil prices also continued their downward trend. Brent futures fell 4.33% and closed at US$73.74 per barrel, the lowest level since before the United States and Israel launched airstrikes on Iran in late February. Meanwhile, West Texas Intermediate (WTI) slumped 3.92% to US$70.34 per barrel, after briefly touching its lowest level since early March. The fall in oil prices also pushed down US government bond yields. The yield on the 10-year US Treasury fell back below the 4.5% level. Energy sector stocks were also depressed. Shares of Exxon Mobil, Chevron, ConocoPhillips, and SLB each corrected by more than 2%. Meanwhile, the energy sector ETF Energy Select Sector SPDR (XLE) fell more than 1%. In the semiconductor sector, Micron shares briefly trimmed their losses but still closed down 0.3%. Shares of other memory maker Sandisk plunged 2.5%. In the previous session, both stocks had slumped up to 13%. Meanwhile, the VanEck Semiconductor ETF (SMH) closed slightly weaker. Micron is scheduled to announce its latest financial performance after the market close on Wednesday. Based on a consensus of analysts compiled by FactSet, the company is expected to post earnings of US$20.83 per share with revenue reaching US$35.75 billion. Wednesday’s market movement occurred after a massive sell-off in the technology sector dragged the S&P 500 and Nasdaq in Tuesday’s trading. Investors offloaded stocks related to the semiconductor industry, causing the SMH chip ETF to close down around 7%. ‘The decline in technology stocks is a healthy correction because many stocks in this sector have risen too high,’ said Rick Gardner, Chief Investment Officer at RGA Investments. According to him, the correction shows that investors are beginning to realise that corporate earnings expectations are too high.