On Friday afternoon, the Indonesia Stock Exchange’s benchmark index fell below the 8,000 level, dropping 209.10 points, or 2.57 percent, to close at 7,915.66.
“If the index keeps going up, investors actually lose because they can’t trade. The same goes if it is flat or keeps falling. The ideal condition is when the market moves in between, so they can take profits,” Sadewa said at the Finance Ministry office here on Friday.
Despite the decline, Sadewa noted that the market’s movement pattern remains relatively stable, typically trending upward for about two weeks before declining in the following two weeks and rebounding afterward.
The former chairman of the Indonesia Deposit Insurance Corporation (LPS) said such fluctuations are normal, pointing out that brokers also benefit from the market’s volatility.
He also believed that the recent market euphoria was driven by investors’ confidence in him, emphasizing that the key focus should be maintaining consistent improvement in Indonesia’s economic fundamentals.
The finance minister stressed that market confidence would return once the government demonstrates its commitment and seriousness in improving the national economy.
“When the economy performs well, companies grow, profitability rises, and their stock values increase as well,” he remarked.
Friday’s JCI decline followed a weakening trend across Asian stock markets. After opening higher, the index moved into negative territory by the end of the first trading session and remained in the red until the market closed.
In its report, the Phintraco Sekuritas Research Team stated that the JCI weakened amid rising global risks caused by escalating trade tensions between the United States and China, the prolonged US government shutdown, and continued profit-taking in conglomerate stocks that had previously surged and supported the index’s gains.
Domestically, plans by authorities to introduce new free-float regulations and stricter enforcement against stock manipulation also prompted profit-taking in stocks that had posted significant gains.
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Translator: Imamatul Silfia, Kuntum Khaira
Editor: Primayanti
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