The Jakarta Composite Index (IHSG) is anticipated to experience further weakening, projected to trade within the 6,081-5,815 range at the open of trading on Friday (May 22). This follows a sharp decline on Thursday (May 21), when the IHSG plummeted by 223.56 points, or 3.54 percent, closing at 6,094.94.
Despite the recent downturn, market analysts are identifying potential opportunities. According to M. Nafan Aji Gusta, Senior Technical Analyst at Mirae Asset Sekuritas Indonesia, “Based on technical analysis, the IHSG is already in an extremely oversold condition and shows positive divergence according to the RSI indicator.” This technical signal suggests that while the market has taken a hit, there might be a rebound or at least a slowing of the downtrend.
Nafan elaborated that the substantial drop in the IHSG has pushed various stocks into a deeply undervalued state. This condition is likely to stimulate selective buying interest from domestic institutional investors, including pension funds and insurance companies. These institutions may engage in gradual accumulation, often termed “bottom fishing,” to capitalize on discounted prices in the wake of recent panic selling.
Beyond domestic technicals, global geopolitical dynamics, particularly involving the US and Iran, remain a primary sentiment driver for the market. Market participants are closely monitoring reports regarding the final draft of a peace agreement between the US and Iran, which has reportedly been achieved with mediation from Pakistan.
“The agreement encompasses an immediate ceasefire on all fronts, guarantees freedom of navigation in the Gulf and the Strait of Hormuz, and the commencement of negotiations on unresolved issues within one week,” Nafan added, highlighting the significance of this development for global stability.
Domestically, investors will also be observing the release of the current account data for Q1 2026, which is predicted to show a modest deficit of only USD 0.8 billion. Nafan interpreted this projection positively, stating, “This estimated deficit indicates that the foreign exchange supply from Indonesia’s export earnings remains remarkably robust in fending off the onslaught of import burdens and external service payments.”
Against this backdrop, Mirae Asset Sekuritas has recommended several stocks for Friday (May 22) trading, including PGAS, ULTJ, and WIIM. Similarly, MNC Sekuritas projects the IHSG to weaken to the 5,899-5,999 level on Friday (May 22). “The next correction area we anticipate will test 5,899-5,999,” MNC Sekuritas stated in its release. For the same trading day, MNC Sekuritas recommended stocks such as BBCA, HMSP, PGAS, and WIIM.
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Disclaimer: Investment decisions are entirely based on the reader’s consideration and judgment. This news is not an invitation to buy, hold, or sell any particular investment product.
Summary
The Jakarta Composite Index (IHSG) is expected to face continued pressure, with analysts projecting a trading range between 5,815 and 6,081 following a sharp decline. Despite this downward trend, technical indicators suggest the market is currently oversold, potentially creating opportunities for domestic institutional investors to accumulate undervalued stocks. Analysts believe this “bottom fishing” strategy may help stabilize the market as investors look past recent panic selling.
Global market sentiment remains influenced by geopolitical developments, specifically the potential peace agreement between the U.S. and Iran, alongside domestic economic data such as the modest Q1 2026 current account deficit. While brokerage firms like Mirae Asset Sekuritas and MNC Sekuritas anticipate further corrections, they have identified specific stocks, including PGAS, WIIM, and BBCA, as notable considerations for investors. Market participants are advised to monitor these indicators closely as the index navigates this period of volatility.