Flooring Guide by Cinvex – , JAKARTA — The Jakarta Composite Index (IHSG) is poised for potential gains in October 2025, driven by a confluence of year-end seasonal effects and anticipated interest rate cuts by the U.S. Federal Reserve (The Fed). This optimistic outlook for the Indonesia stock market comes as investors weigh various domestic and international factors shaping market sentiment.
According to Arifin, an analyst at Reliance Sekuritas Indonesia, the fourth-quarter seasonal trends are expected to inject positive sentiment into the domestic equity market. Historically, the period from October to December has frequently proven to be a robust quarter for index performance. Indeed, data reveals that from 2011 to 2024, the IHSG recorded an average positive return of 1.91% in October, underscoring this recurring trend in the Indonesian economy.
Reliance Sekuritas highlights that central bank policies will be the primary determinants of market movement this month. Both Bank Indonesia (BI) and The Fed implemented 25 basis point interest rate cuts in September 2025, albeit with distinct underlying motivations. Arifin explained that BI is shifting its focus from rupiah stability towards stimulating credit growth and overall economic expansion, aligning with government initiatives for accelerated recovery. Conversely, The Fed’s decision to lower interest rates was prompted by a slowdown in U.S. labor growth.
Looking ahead, market participants are anticipating further monetary easing, with expectations for two additional interest rate reductions by The Fed before the close of 2025. Beyond interest rate adjustments, other critical issues commanding investor attention include the potential U.S. government shutdown, the upward trajectory of gold prices fueled by central bank purchases, and the impact of President Donald Trump’s plans to end the Gaza conflict, which is exerting downward pressure on global oil prices.
The IHSG demonstrated robust performance throughout September 2025, climbing 2.94% monthly and registering an impressive 13.86% gain year-to-date (YtD). This strong showing positions the Indonesian stock market favorably, ranking 18th globally and 4th within the Asian region. Notably, Prajogo Pangestu’s Barito Group was a significant driver for the IHSG‘s momentum during September 2025.
For October, Reliance Sekuritas has identified eight compelling stock picks with the potential to outperform the index: BUMI, BKSL, BSDE, CDIA, CUAN, PGO, SCMA, and WIRG. Arifin expressed confidence that these selected stocks are well-positioned to “beat the index” this month.
In parallel, the Indonesia Stock Exchange (IDX), or Bursa Efek Indonesia (BEI), reported a 0.23% weekly increase in its composite index, reaching 8,118.30 from September 29 to October 3, 2025. Furthermore, BEI’s market capitalization expanded by 1.29%, escalating to Rp15,079 trillion from Rp14,888 trillion in the preceding week, as stated by BEI Corporate Secretary Kautsar Primadi Nurahmad in a press release on Saturday, October 4, 2025.
The week also saw an uptick in trading activity across the board. The average daily transaction frequency rose by 6.68% to 2.62 million times, up from 2.46 million transactions the prior week. Concurrently, the average daily transaction volume on the exchange increased by 5.61% to 49.72 billion shares, compared to 47.08 billion shares in the previous period.
Regarding investor sentiment, foreign investors recorded a net buy of Rp199.79 billion at the close of last week. However, this weekly inflow contrasts with a year-to-date net sell position of Rp56.71 trillion from foreign capital, indicating a mixed sentiment over the longer term.
Disclaimer: This news article is not intended as an invitation to buy or sell stocks. Investment decisions are solely at the discretion of the reader. Bisnis.com is not responsible for any losses or gains arising from readers’ investment decisions.
Summary
The Jakarta Composite Index (IHSG) is expected to experience gains in October 2025, driven by year-end seasonal trends and anticipated interest rate cuts by the U.S. Federal Reserve. Historically, October has shown an average positive return for the IHSG, with central bank policies playing a pivotal role. Both Bank Indonesia and The Fed implemented interest rate cuts in September 2025, and further monetary easing by The Fed is expected, influencing market movements.
In September 2025, the IHSG recorded a strong performance, climbing 2.94% monthly and achieving a 13.86% year-to-date gain, positioning it favorably within the Asian market. The Indonesia Stock Exchange also reported a weekly increase in its composite index and market capitalization by early October 2025, alongside a rise in trading activity. While foreign investors registered a net buy last week, they maintained a year-to-date net sell position.