TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search results
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search resultsIDX eyes second-half recovery, policy and external risks remain
The Indonesia Stock Exchange (IDX) Composite index is expected to rebound in the second half as easing MSCI concerns, fiscal stimulus and attractive valuations lift investor sentiment, but policy uncertainty and external risks could temper gains.
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
A group of visitors take a photo on Jan. 29 in front of a stock ticker display at the Indonesia Stock Exchange (IDX) in South Jakarta. (AFP/Yasuyoshi Chiba)
T
he Indonesia Stock Exchange (IDX) Composite index is expected to recover in the second half of 2026 after posting one of the weakest performances among global markets in the year's first six months, with analysts pointing to easing concerns over Indonesia's standing in MSCI indexes, attractive valuations and a revival in initial public offerings (IPOs) as factors that could help restore investor confidence.
The index fell about 35 percent in the first half, weighed down by foreign capital outflows, a weakening rupiah, rising bond yields and concerns over government policy direction.
It was down around 32 percent year-to-date at 5,873.37 points on Wednesday after dropping 1.89 percent from the previous day amid a new flare-up of violence in the Middle East and after S&P Dow Jones Indices (DJI) announced it put Indonesia on a watch list for a potential downgrade to frontier market status in its 2027 annual review.
Read also: S&P DJI flags risk of frontier market downgrade for Indonesia
The selloff has widened the gap between Indonesia and regional peers. According to FSM Global's ASEAN Outlook published on July 2, Singapore and Malaysia have outperformed Indonesia, supported by stronger external balances, resilient foreign direct investment and relatively stable macroeconomic conditions.
Singapore has even overtaken Indonesia as Southeast Asia's largest equity market, while Indonesia's weight in the MSCI ASEAN Index dropped to around 9 percent from the mid-teens.
Despite the bleak first-half performance, analysts believe the market could stage a rebound in the coming months if several key domestic and global catalysts materialize.
