Indonesian Equities Rally After BI Rate Decision

Indonesian shares surged 69 points, or 1.1%, to 6,465 in early Thursday trade, rebounding from the prior session’s weakness with broad gains across major sectors. Sentiment was lifted after Bank Indonesia held its benchmark rate steady at 5.75% for a second month on Wednesday, in line with estimates, following cumulative hikes of 100bps since May. In main trading partner China, lending benchmarks were also left unchanged for a 15th straight month, with one- and five-year LPRs kept at record lows to support growth. However, caution lingered ahead of Q2 current account data due later this week, after Q1’s deficit widened to its largest since 2019 on weaker trade. Meanwhile, FTSE Russell said it will delay additions, upgrades, and weight increases for Indonesian stocks until at least its December review as it evaluates market reforms. Early standouts included Hartadinata Abadi (8.3%), Amman Mineral International (7.2%), Vale Indonesia (3.4%), and Aneka Tambang (3.3%).

Indonesian shares slipped 39 points or 0.6% to 6,410 in early Wednesday trade, reversing gains from the prior two sessions as Wall Street’s overnight selloff in semiconductors, elevated bond yields, and rising oil prices weighed on sentiment. Domestic caution deepened amid recent natural disasters, doubts over 2027 budget assumptions, and delays in electric motorcycle incentives. Market focus vigilantly turned to Bank Indonesia’s policy decision later today, its first under Acting Governor Destry Damayanti, with interest rates expected to stay unchanged after a cumulative 100 bps of hikes since May. However, traders remain increasingly watchful of how she balances currency stability against President Prabowo Subianto’s growth agenda. Sectoral losses were broad, led by energy, cyclicals, and basic materials, though property gains helped limit declines. Notable laggards included MNC Tourism (-2.9%), Bank Jago (-2.6%), Pertamina Geothermal Energy (-2.3%), and Alamtri Minerals (-2.1%).

Indonesian stocks climbed 63 points or 1.0% to 6,463 on Tuesday morning deals, building gains from the prior session as markets reopened after Monday's holiday. Sentiment was buoyed by optimism that economic output will stay resilient next year, supported by improved fiscal conditions, reforms in energy security, and capital-market transparency. Meanwhile, the central bank will begin its first policy meeting today, the first time since Perry Warjiyo’s departure last month, with hopes of continuity prospects growing under acting Governor Destry Damayanti, the sole nominee to lead Bank Indonesia. However, gains were limited by weaker U.S.equity futures following losses on Wall Street overnight oil prices rose as the US and Iran appeared no closer to a deal. Still, most sectors advanced, led by energy, basic materials, non-cyclicals, and industry. Among early standouts were Indika Energy (5.1%), Japfa Comfeed (4.7%), Bumi Resources 02.2%),and United Tractor (2.0%).