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Jakarta, June 26, 2026 – The Jakarta Composite Index (IHSG) suffered a sharp decline on Friday morning, June 26, 2026, tumbling more than 2 percent as widespread selling swept across the market.
The downturn left over 546 stocks in negative territory, underscoring investor anxiety over global inflationary pressures and weakening domestic competitiveness.
The benchmark index fell below the 5,900 level, erasing gains from the previous session and signaling a fragile outlook for Indonesian equities.
By mid morning, IHSG was trading between 5,890 and 5,906 points, marking a drop of 1.55 to 1.81 percent.
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Trading activity remained brisk, with more than 4 billion shares exchanged and transaction values surpassing Rp2.3 trillion.
Yet the breadth of decline was striking: only a handful of stocks managed to post gains, while the majority succumbed to selling pressure.
Global and Domestic Headwinds
The sell off was fueled by renewed concerns over global inflation.
In the United States, the Personal Consumption Expenditures (PCE) index rose to 4.1 percent year on year, stoking fears that the Federal Reserve may adopt a more hawkish stance.
Such expectations rattled emerging markets, where capital outflows often follow tighter U.S. monetary policy.
Closer to home, Indonesia’s competitiveness ranking has slipped dramatically.
Within two years, the country fell 21 places in the World Competitiveness Ranking, dropping from 27th to 48th.
This decline has raised alarms among investors about the nation’s long-term economic prospects.
Liquidity pressures also weighed on sentiment.
The Deposit Insurance Agency (LPS) raised guaranteed deposit rates, while the government began withdrawing Saldo Anggaran Lebih (SAL) funds from banks, tightening financial conditions.
The financial sector initially provided some support, with gains of 1.7 to 2 percent.
However, the momentum quickly faded as selling spread across blue-chip counters.
Energy and property stocks showed early strength but failed to offset the broader decline.
The LQ45 index, which tracks large-cap stocks, slipped 0.12 percent, reflecting weakness even among market leaders.
Investor Sentiment
Analysts characterized the plunge as a “shock reaction” rather than a fundamental shift, noting that global markets still expect the Fed to hold rates steady.
Nevertheless, foreign investors continued net selling, particularly in major banks and consumer stocks.
Volatility remained high, with IHSG trading in a wide range between 5,929 and 6,045 points during the morning session.
In the short term, analysts expect IHSG to hover within the 5,850 to 6,100 range, with support at 5,920 and resistance near 6,120.
Persistent concerns over Indonesia’s competitiveness ranking and liquidity tightening could weigh on sentiment in the medium term.
Globally, any hawkish signals from the Federal Reserve are likely to intensify selling pressure across emerging markets, including Indonesia.
For now, investors remain cautious, bracing for further turbulence in the weeks ahead.
