In a significant market development, the Jakarta Composite Index (IHSG) surged past the 8,500 mark during Monday’s trading session on November 24, 2025. This impressive performance culminated in a new all-time high (ATH) of 8,570.25, igniting optimism that the IHSG could continue to set new records before the close of the year.
Muhammad Wafi, Head of Research at Korean Investment & Sekuritas Indonesia (KISI), underscored the profound significance of the IHSG breaching the 8,500 level. He elaborated that a convergence of several key sentiments had fueled this remarkable strengthening of the composite index.
“The upward momentum was driven by factors including the MSCI rebalancing, a resurgence in foreign net buying, and abundant liquidity stemming from the Federal Reserve’s increasingly mildly dovish stance,” Wafi stated on Tuesday, November 25, 2025. He further added, “Additionally, both second-tier stocks and the commodity sector have maintained an aggressive growth trajectory, contributing significantly to the overall rally.”
Despite the robust performance, with the IHSG appreciating by 21% year-to-date, Wafi cautioned that the market is entering a phase of overextension, making it susceptible to corrections. He noted that after the IHSG successfully breaks through significant psychological resistance levels, market participants often engage in initial profit-taking.
Currently, Wafi believes that a correction to the 8,250-8,350 range would remain a healthy and manageable adjustment for the IHSG, indicating a resilient underlying market structure.
On the flip side, investors must remain vigilant regarding several crucial factors. Wafi highlighted the increasingly elevated valuations observed in specific sectors, notably technology, second-tier stocks, and new energy, suggesting they may be becoming overpriced.
Furthermore, global sentiments, including policy shifts from the Federal Reserve, evolving geopolitical developments, and movements in US bond yields, warrant close monitoring. Investors should also prepare for potentially more aggressive sector rotations in the near future.
Looking towards the year-end, Wafi anticipates that both the traditional Santa Claus rally and window dressing strategies could still provide significant impetus, propelling the IHSG to further gains.
He explained that institutional investors typically drive this year-end surge by focusing on blue-chip stocks that possess strong dividend catalysts, benefit from seasonal demand, and offer clear earnings visibility.
Given these prevailing conditions, Wafi projects that the IHSG reaching the 8,900 level remains a quite realistic target, contingent upon global sentiments not undergoing any drastic negative shifts.
Summary
The Jakarta Composite Index (IHSG) reached a new all-time high of 8,570.25 on November 24, 2025, exceeding the 8,500 mark. Muhammad Wafi from KISI attributed this surge to factors like MSCI rebalancing, increased foreign net buying, abundant liquidity from the Federal Reserve’s dovish stance, and strong growth in second-tier and commodity stocks. This strong performance has fueled optimism for the IHSG to achieve further records by year-end.
Despite this robust year-to-date appreciation, Wafi cautioned that the market is overextended and susceptible to healthy corrections, potentially to the 8,250-8,350 range. He also warned about elevated valuations in technology, second-tier, and new energy sectors, as well as the impact of global sentiments and US bond yields. However, Wafi anticipates year-end Santa Claus rallies and window dressing, driven by blue-chip stocks, could realistically push the IHSG to an 8,900 target.