Caution Weighs on Indonesia Equities, Weekly Recovery Still Intact

Indonesian shares slipped 25 points, or 0.3%, to 8,240 in Friday morning trade, extending the prior session’s losses after Wall Street’s sharp retreat overnight amid persistent pressure on tech stocks, ahead of U.S. CPI data later today. Locally, foreign investors remained cautious, signaling defensive positioning before Bank Indonesia’s policy meeting next week, following the swearing-in of a new deputy governor that stirred debate over central bank independence. Losses were led by basic materials, healthcare, and infrastructure, with notable declines in Amman Mineral Intl. (-4.2%), Vale Indonesia (-3.9%), and Telkom Indonesia (-2.3%). Still, the market is on track for its first weekly gain in four weeks, up about 3.8% so far, boosted by signs of rapid post-disaster recovery in Sumatra, highlighted by the Cabinet Secretary. In top trading partner China, hopes grew that weak CPI and PPI data in January would prompt Beijing to roll out fresh support ahead of March legislative meeting.

Indonesia's IDX Composite inched down 11 points, or 0.1%, to 8,279 in early Thursday trade, snapping a three-session rally as losses in non-cyclicals, property, and healthcare stocks weighed on the index. Some traders locked in profits after markets hit a near two-week high the prior day, rebounding from an earlier rout linked to transparency concerns. Sentiment was also hit as Indonesia fell to 109th in the 2025 Corruption Perceptions Index, signaling worsening views on governance and anti-corruption efforts that may cloud reform credibility. Still, losses were capped by Jakarta's plan to distribute around IDR 17 trillion in social aid ahead of the Eid al-Fitr festival, benefiting 18 million families and supporting consumption. Meanwhile, bets for fresh stimulus in main trading partner China grew after softer January CPI and persistent producer deflation. Notable decliners included Mora Telematika (-3.9%), Pradiksi Gunatama (-3.1%), Soho Global Health (-2.9%), and Avia Avian (-1.3%).

Indonesian stocks climbed 66 points, or 0.8%, to 8,199 in Wednesday’s morning session, extending gains for a third day as U.S. futures traded notably higher despite Wall Street’s mixed close overnight amid soft December household spending and caution ahead of key jobs data. Locally, Vice Finance Minister Juda Agung voiced confidence that Indonesia's Q1 GDP growth will surpass the 5.39% recorded in Q4, supported by stronger consumption during the Lunar New Year and Ramadan festivals, as well as improved labor absorption. Still, upside was capped by reports that the EU may extend sanctions to Indonesian ports handling Russian oil, the first time emerging markets could be targeted. Meanwhile, FTSE Russell postponed its Indonesia index review, originally set for March 2026, citing uncertainty over free-float rules. Cyclical, energy, and industrial stocks led advances, with notable performers from Dian Swastatika Sentosa (3.3%), United Tractors (2.1%), and Bayan Resources (1.4%).