Indonesia Stocks Rise as Investors Watch Fed Policy

Indonesia Stocks Rise as Investors Await Fed Policy Decisions

Indonesia Stocks Rise as Investors Watch – On Thursday, the Jakarta Composite Index (JCI) experienced a modest increase, reflecting market sentiment as global interest rate trends remained a focal point for investors. The index opened 14.72 points higher, or 0.26 percent, at 5,709.84, while the LQ45 index, tracking 45 major blue-chip stocks, climbed 2.57 points, or 0.46 percent, to 559.32.

Technical Analysis and Market Outlook

According to Maximilianus Nico Demus, a research and investment associate at Pilarmas Investindo Sekuritas, the JCI’s upward momentum is constrained by specific support and resistance levels. He noted that the index faces potential corrections, urging caution despite current gains.

“Based on technical analysis, we see the JCI has limited potential for strengthening, with support and resistance levels of 5,320–5,735. A correction is still possible, so please remain cautious,” said Nico in Jakarta on Thursday.

Global Central Bank Perspectives

At a European Central Bank (ECB) meeting, Fed Chair Kevin Warsh highlighted a decline in inflation expectations over the initial four weeks, indicating that the central bank remains focused on maintaining price stability. He emphasized that inflation risks have eased, with the target staying at 2 percent.

“Inflation expectations have declined over the first four weeks, aligning with the Fed’s commitment to inflation control,” Warsh stated during the ECB forum.

Domestic Economic Indicators

Indonesian domestic data revealed a 0.44 percent monthly inflation rate in June 2026, compared to a 1.79 percent calendar-year increase and a 3.34 percent annual rise. These figures were attributed to seasonal factors, higher raw material costs, and fuel price fluctuations.

Meanwhile, the Central Statistics Agency (BPS) reported a trade deficit of US$1.61 billion in May 2026, marking the first such deficit in six years. Imports reached US$24.81 billion, surpassing exports of US$23.20 billion.

“Pressure on Indonesia’s external sector is growing, primarily due to slowing exports amid weak global demand and falling commodity prices,” Nico observed.

Market Reactions and Regional Trends

European stock markets on June 1 displayed mixed performance, with the Euro Stoxx 50 falling 0.70 percent, the FTSE 100 dropping 0.18 percent, the DAX index rising 0.18 percent, and the CAC 40 decreasing 0.79 percent. US markets on the same day also showed varied movements, including a 0.03 percent decline in the Dow Jones and a 1.54 percent drop in the Nasdaq Composite.

Asian indices mirrored this global uncertainty. The Nikkei index surged 1.55 percent to 19,733.00, while the Shanghai Composite fell 0.83 percent to 4,078.00. The Hang Seng Index dropped 1.15 percent to 23,143.00, and the Straits Times Index rose 0.49 percent to 5,186.00.

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