Indonesia’s composite stock index, IHSG, opened weaker on the morning of August 14 before failing to establish a clear direction.
Market participants shifted their attention away from stock prices themselves and toward President Prabowo Subianto’s state address and explanation of the 2027 budget proposal.
The key issue that day was not a single remark in the speech, but the growth, fiscal, and investment plans the government would present.
3-Line Summary
1. IHSG remained within a narrow range ahead of the president’s speech.
2. It fell 0.08% after the open to 6296.59.
3. The market was waiting for specific figures in the budget proposal.
IHSG Paused at 6296, With Attention Turning to the Speech
IHSG is the composite stock price index of the Indonesia Stock Exchange (BEI). According to ANTARA News, on the morning of Friday, August 14, IHSG opened 5.18 points, or 0.08%, lower than the previous trading day at 6296.59. The LQ45 Index, composed of 45 leading stocks, also fell 0.09%.
Still, it is difficult to interpret this movement as a clear selling phase. The head of research at local securities firm Pilarmas Sekuritas expected IHSG to move sideways within the 6230–6370 range that day. This can be interpreted as a situation in which the market was waiting for the scheduled political and fiscal messages rather than immediately choosing a direction.
The observed search market was Indonesia, but this fact alone does not establish the actual location of the event or the locations of each media outlet. However, the ANTARA News article covered IHSG and the president’s speech as a market story reported from Jakarta.
What the Market Was Waiting For Was Not the “Mood of the Speech”
President Prabowo Subianto was scheduled to deliver a state address at the 2026 annual session of the MPR and the joint session of the DPR and DPD, followed by a presentation of the 2027 State Budget Proposal (RAPBN) and a fiscal explanation. The MPR is Indonesia’s People’s Consultative Assembly, the DPR is the House of Representatives, and the DPD is the Regional Representative Council.
The items market participants examined were also relatively clear. ANTARA News reported that attention was focused on the economic growth target, fiscal deficit, rupiah exchange-rate assumption, financing strategy, and government programs to support consumption and investment. The reason stock prices moved sideways before the speech was that the policy announcements had not yet been finalized as outcomes.
The parliamentary budget committee identified the 2027 national priorities as 8 groupings: food sovereignty; energy and water self-sufficiency; education; health; downstream industrialization and infrastructure; housing and disaster resilience; the people’s economy and rural areas; and poverty alleviation. However, presenting these priorities does not mean that the implementation scale or market impact of individual programs had been finalized. Investors wanted to confirm the targets and financing methods contained in the budget proposal rather than focus on broad slogans.
U.S. Inflation and Oil Prices Were Also Part of the Day’s Backdrop
Domestic policy was not the only factor moving the market. The same report cited the U.S. July Consumer Price Index (CPI) as 3.4% higher than in the same month of the previous year, while core CPI was 2.5%. The Producer Price Index (PPI) was unchanged month over month in July, below the market expectation of a 0.2% increase.
This inflation trend was cited as a factor reducing expectations of interest-rate increases by the U.S. Federal Reserve (Fed). CNBC Indonesia also reported that the U.S. PPI was 0% month over month, while core PPI excluding food and energy rose 0.2%. The same article reported that U.S. stocks rose and that Brent crude and WTI prices each fell by more than 2%.
However, gains in overseas markets and falling crude oil prices did not guarantee an increase in IHSG. That day, IHSG was influenced by external inflation and oil-price variables as well as the domestic variables of the president’s speech and budget proposal, whose contents had not yet been disclosed. Thus, the key point in this scene lies less in the index’s small decline than in what the market was waiting for.
The “Sideways Forecast” and the Actual Result Are Different
Pilarmas Sekuritas’ 6230–6370 forecast was only an intraday forecast. Whether IHSG actually closed within that range, and which stocks or sectors moved after the speech, cannot be confirmed from the reports provided.
Likewise, the statement that the budget proposal could stimulate consumption and investment describes what the market might examine; it is not an announcement that the policy effects had already appeared. At the time, the market was assessing whether the figures for growth, the deficit, the exchange rate, and financing fit together.
IHSG on August 14 was an example of waiting rather than strong directional movement. The president’s speech was a political event, but before the budget proposal’s figures were released, it was also a catalyst for the financial markets. In this context, the index’s narrow range is more reasonably read not as a sign of indifference, but as movement reflecting an effort not to predetermine the price of policy details that had not yet been finalized.
References
Tags #IHSG #IndonesianStockMarket #IndonesiaStockExchange #PrabowoSubianto #PresidentialSpeech #IndonesianBudgetProposal #RAPBN #Rupiah #LQ45 #USCPI #USPPI #InternationalOilPrices