JAKARTA — The Indonesian Composite Index (IHSG) is widely anticipated to extend its recent decline into the coming week’s trading session, largely overshadowed by escalating social unrest and political demonstrations. Despite this looming concern, analysts point to several specific stocks that still present compelling investment opportunities.
Data from the Indonesia Stock Exchange (BEI) reveals that the IHSG already shed 1.53% this past week, closing at 7,830.49 on Friday, August 29, 2025. This downturn comes despite the index maintaining a positive trajectory year-to-date (YTD), showing a robust 10.63% gain since the first trading day of 2025.
Adding to market jitters, Indonesia’s stock market recorded a significant foreign net sell of Rp1.12 trillion during the week’s final trading session. This substantial outflow contributes to a cumulative foreign net sell reaching Rp50.94 trillion year-to-date, signaling growing caution among international investors.
: Projecting the Fate of the IHSG Next Week Amidst Waves of Demonstrations
The precipitous drop in the Indonesian stock market unfolds against a backdrop of intensifying public demonstrations. Protests by laborers and the general public in Jakarta on Thursday, August 28, 2025, stretched late into the night. Tragically, a critical incident occurred involving an online motorcycle taxi driver (ojol) who lost his life after allegedly being run over by a police tactical vehicle.
This devastating event ignited widespread public fury, particularly among fellow online taxi drivers. Hundreds of enraged individuals subsequently converged on the Mobile Brigade (Mako Brimob) headquarters in Kwitang, Jakarta, demanding justice and accountability.
: BEI Invites Journalists Amidst IHSG Collapse and Chaotic Protests, What Will Be Discussed?
The public’s anger soon spiraled, leading to unsettling reports of looting at the residences of several members of the House of Representatives (DPR RI), and even extending to the home of Finance Minister Sri Mulyani. This escalating civil unrest underscores the volatile political climate.
Indonesian Capital Market Activist Reydi Octa warned that the IHSG is highly susceptible to a weaker opening on Monday, September 1, 2025, directly attributing it to the political turmoil that gripped the nation over the weekend. “History proves markets are highly sensitive to social and political issues,” Reydi told Bisnis on Sunday, August 31, 2025. “A panic sell is a real possibility tomorrow, especially if the situation fails to de-escalate and the government hasn’t taken proactive strategic steps to calm the unrest.”
: BBCA to TLKM Among Top Laggards, Here’s a List of 10 Stocks Weighing Down the IHSG This Week
Providing a technical perspective, Oktavianus Audi, VP Marketing, Strategy, and Planning at Kiwoom Sekuritas Indonesia, projected that the IHSG would exhibit a mixed-to-weaker trend during the early trading sessions next week, Monday, September 1, 2025. He forecasts the index to move within a support level of 7,745 (MA20) and a resistance level of 7,920. Furthermore, Audi highlighted that the MACD indicator points to a weakening trend, a sentiment echoed by the Relative Strength Index (RSI) which has declined after entering the overbought zone.
“Foreign concerns have significantly increased due to the escalation of domestic political instability, evidenced by a capital outflow reaching Rp1.12 trillion [on Friday, August 29, 2025] across all trades,” Audi stated to Bisnis on Sunday, August 31, 2025. Compounding the pressure, the Rupiah’s exchange rate has depreciated beyond Rp16,400 per US dollar, reaching its highest level since early August 2025, further dampening sentiment in the Indonesian stock market.
Audi anticipates several key sentiments will shape the IHSG’s trajectory next week. Foremost among them is the continued escalation of domestic political instability, which is expected to erode investor confidence and consequently depress market performance.
Additionally, the release of Indonesia’s August 2025 inflation data, projected to grow 2.4% year-on-year (YoY), and the S&P Manufacturing PMI data, expected to remain in the contraction zone, are both likely to elicit a moderate response from the market.
“Nevertheless, we identify positive momentum within the raw materials sector, driven by gold prices hitting a one-month high of US$3,400 per troy ounce. Defensive sectors also show resilience,” Audi added, offering a glimmer of optimism amidst the broader uncertainty.
Capitalizing on these pockets of positive momentum, several stocks are recommended for short-term “speculative buy” positions. These include PT Bank Rakyat Indonesia Tbk. (BBRI) with a target price of Rp4,250 per share, PT Amman Mineral Internasional Tbk. (AMMN) targeting Rp8,450 per share, and PT Bumi Resources Minerals Tbk. (BRMS) with a target price of Rp505 per share.
_______
Disclaimer: This news article does not aim to encourage the buying or selling of stocks. Investment decisions are solely at the discretion of the reader. Bisnis.com is not responsible for any losses or gains arising from the reader’s investment decisions.
Summary
The Indonesian Composite Index (IHSG) is anticipated to extend its decline, primarily due to escalating social unrest and political demonstrations in Jakarta. The index already fell 1.53% last week, coupled with significant foreign net selling and a depreciating Rupiah beyond Rp16,400 per US dollar. This market downturn is largely attributed to widespread public anger following a fatal incident during protests, leading to increased political volatility. Analysts predict a weaker opening and a potential “panic sell” if the situation fails to de-escalate.
Technically, the IHSG is projected to exhibit a mixed-to-weaker trend next week, with indicators pointing to weakening momentum driven by domestic political instability. While upcoming August inflation and manufacturing PMI data are expected to have a moderate impact, positive momentum is observed in the raw materials sector, supported by gold prices hitting a one-month high. Defensive sectors also show resilience, with specific stocks like BBRI, AMMN, and BRMS recommended for short-term “speculative buy” positions.