Indonesia Stocks Retreat on Global Jitters
Indonesian shares slipped 42 points, or 0.7%, to 6,332 in Thursday morning trade, reversing the prior day’s rally as U.S. futures slipped after Wall Street’s overnight losses. Surging U.S. Treasury yields stoked inflation fears, weighing on global sentiment. Locally, economists warned that Bank Indonesia’s move to hold benchmark rates steady for a third month in September may be only a temporary pause, with external risks still elevated from higher global yields, volatile oil prices, and geopolitical headwinds. Policymakers also face challenges from slowing growth, tepid household spending, and fragile market sentiment, particularly as the rupiah remains vulnerable to renewed dollar strength and foreign outflows. Still, losses were capped by resilient loan growth, with August figures near a 12-year peak. Declines were broad-based, led by basic materials, healthcare, and property. Notable laggards included Bumi Resources (-3.1%), Pertamina Geothermal (-2.3%), and Indika Energi (-1.8%).
S. futures slipped after Wall Street’s overnight losses. S. Treasury yields stoked inflation fears, weighing on global sentiment.
Locally, economists warned that Bank Indonesia’s move to hold benchmark rates steady for a third month in September may be only a temporary pause, with external risks still elevated from higher global yields, volatile oil prices, and geopolitical headwinds. Policymakers also face challenges from slowing growth, tepid household spending, and fragile market sentiment, particularly as the rupiah remains vulnerable to renewed dollar strength and foreign outflows. Still, losses were capped by resilient loan growth, with August figures near a 12-year peak. Declines were broad-based, led by basic materials, healthcare, and property.
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