Trump's 15 Per Cent Tariff Puts Indonesian Composite Index at Risk of Correction; Which Sectors Are Most Vulnerable?
Jakarta – US President Donald Trump’s plan to raise import tariffs to 15 per cent is assessed as having the potential to create downward pressure on Indonesia’s domestic stock market.
The policy is expected to trigger global risk-off sentiment, a condition wherein investors tend to reduce their exposure to risky assets. In such circumstances, the Indonesian Composite Index (IHSG) faces potential correction, particularly in sectors sensitive to international trade and currency movements.
Protectionist policy is seen as capable of increasing global uncertainty. Financial markets generally respond swiftly to trade war concerns because they affect trade flows, economic growth, and corporate profit projections.
In a risk-off scenario, foreign funds tend to exit emerging markets such as Indonesia and shift to safe-haven assets such as US dollar assets and US government bonds.
“The most vulnerable sectors are export-oriented manufacturing and industrial commodities such as nickel, because they are highly sensitive to global demand slowdowns. If the Chinese and US economies slow, commodity prices could correct,” said Hendra when contacted by Kompas.com on Friday (27 February 2026).
According to him, coal also faces potential pressure if projections for industrial energy consumption weaken, particularly if the economic slowdown becomes widespread.
He added that the prospects for coal and nickel stocks will depend heavily on the depth of the global slowdown. If tariff increases trigger only short-term volatility, commodity price corrections are estimated to be limited. However, if a more widespread contraction in global trade occurs, pressure could persist.
Nevertheless, the banking sector is considered relatively more resilient compared to export-based sectors on a fundamental basis, supported by strong capital structures and a dominant domestic market.
“Banking can be hit by foreign selling sentiment because of its large weighting in the IHSG and high liquidity, making it often a source of funds when global investors undertake rebalancing. However, on a fundamental basis, major banks are relatively more resilient because of strong capital structures and the domestic market remaining dominant,” Hendra explained.