Market Turmoil: JCI Suffers Meaningful Losses

The Jakarta Composite Stock Price Index (CSPI) experienced a dramatic downturn today, succumbing to market pressures attributed to concerns surrounding potential rate adjustments influenced by former U.S. President Donald Trump. The index closed at 5,996.1, a steep decline of 514.4 points, representing a 7.9% drop. despite the widespread losses, a small number of stocks, including SOSS and CYBR, managed to weather the storm.

The day’s trading activity saw a total transaction value of Rp 20.9 trillion. Market breadth was overwhelmingly negative, with only 30 stocks advancing, while a staggering 672 stocks declined, and 95 remained unchanged. The exchange saw a trading volume of 22.7 billion shares executed in 1.4 million transactions.

Sectoral Breakdown: Raw Goods and Technology hit Hardest

Across the board, all sectors of the Indonesian stock market faced significant setbacks. The raw goods sector bore the brunt of the sell-off,plummeting by 10.5%. The technology sector followed closely behind with a 10.2% decrease. Other notable declines were observed in the non-primary consumer goods sector (8.8%), the industrial sector (8.4%), and infrastructure (8.3%).

Trading Halt Triggered by Market plunge

The severity of the market decline triggered a trading halt between 09:00 and 09:30 Western Indonesian Time (WIB) after the JCI plummeted by more than 8%. In response, the Indonesia Stock Exchange (IDX) has implemented adjustments to its temporary freezing provisions (trading halt) and the auto rejection lower limit (ARB) to stabilize the market and bolster investor confidence. These measures are designed to prevent excessive volatility and maintain orderly trading conditions.

IDX Initiatives to Restore Confidence

Iman Rachman, President Director of the IDX, stated that these policy adjustments are intended to provide reassurance to market participants amidst heightened volatility stemming from global economic dynamics, especially the potential impact of import tariff policies enacted by Donald Trump. The IDX is actively seeking to mitigate the negative effects of external factors on the domestic market.

Moreover, the IDX has introduced a relaxation of regulations allowing issuers to conduct share repurchases (buyback) without requiring approval from a general meeting of Shareholders (GMS). This measure aims to stimulate demand and improve liquidity within the market. Share buybacks can often signal to the market that a company believes its shares are undervalued, potentially attracting investors and stabilizing prices.

We hope that liquidity can continue to increase. Not only from institutional or individual investors, but also from buyback Corporation.
Iman Rachman,President Director of the IDX

This initiative is part of a broader strategy to encourage corporate participation in stabilizing the market and supporting investor sentiment. Similar measures have been implemented in other markets during periods of economic uncertainty. For example, during the 2008 financial crisis, many companies worldwide initiated buyback programs to support their stock prices.