JAKARTA – The Composite Stock Price Index (IHSG) is expected to trade with mixed sentiment this Thursday (May 21, 2026), with support levels projected between 6,200 and 6,250.
Analysts at Phintraco Sekuritas suggest that the market is closely monitoring President Prabowo Subianto’s speech during the House of Representatives (DPR) Plenary Session. The address, which focused on the Macroeconomic Framework and Fiscal Policy Principles (KEM-PPKF) for the 2027 State Budget (RAPBN), has sparked significant investor interest.
A key point of contention is the government’s plan to mandate the export of natural resource commodities exclusively through state-owned enterprises (BUMN). This policy shift is widely seen as a potential transformation of the nation’s export trade structure. Furthermore, the President has instructed state-owned banks, known as Himbara, to lower credit interest rates specifically for small business owners.
Market Reaction to Monetary Policy
Market sentiment is also being shaped by Bank Indonesia’s (BI) recent decision to raise the BI Rate by 50 basis points to 5.25% during its May 2026 meeting—surpassing the 5% consensus. This aggressive monetary stance has provided a boost to the Rupiah, which strengthened by 0.29% to reach 17,654 per US dollar.
Regarding the technical outlook, Phintraco Sekuritas noted, “Combining technical signals with shifting policy sentiment, the IHSG is likely to trade with volatility this Thursday, with support estimated at 6,200–6,250 and resistance levels at 6,400–6,450.”
Sectoral Impacts and Future Outlook
On Wednesday (May 20), the IHSG closed down by 0.82% to 6,318.50 following a volatile trading session. Investors are advised to remain cautious, particularly regarding sectors sensitive to government policy—such as commodities and banking—as well as monitoring the currency’s trajectory following the central bank’s rate hike.
Analysts at OCBC Sekuritas highlighted that domestic sentiment will remain the primary driver for the market moving forward. The planned establishment of a body under Danantara, tasked with centralizing the exports of strategic commodities like CPO, coal, and minerals, has already triggered a sell-off in export-oriented commodity stocks. In contrast, companies focused on the domestic market have remained relatively neutral.
Market participants are now waiting for further clarity on the implementation and operational mechanisms of this new regulatory body. Meanwhile, BI’s decision to hike rates remains a central point of focus. This move serves to reinforce the central bank’s commitment to maintaining currency stability amidst a complex environment of rising global oil prices, budget deficits, increased CDS and bond yields, and ongoing MSCI sentiment.
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Summary
The Composite Stock Price Index (IHSG) is expected to trade with mixed sentiment, with support levels projected between 6,200 and 6,250. Market attention is primarily focused on President Prabowo Subianto’s policy announcements, including a proposed mandate to channel natural resource exports through state-owned enterprises and a push to lower credit interest rates for small businesses.
Additionally, investor sentiment is influenced by Bank Indonesia’s decision to raise the benchmark interest rate to 5.25%, a move aimed at stabilizing the Rupiah amid global economic pressures. Analysts advise caution in sectors sensitive to these regulatory shifts, as the market awaits further clarity on the implementation of the new government-backed export body and its long-term impact on commodity-driven stocks.
