IHSG Eyes 8,000 Mark as Investors Embrace Bullish Sentiment
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JAKARTA, investortrust.id — Indonesia’s main stock index is edging closer to the psychologically significant 8,000 mark, supported by a wave of positive sentiment and policy tailwinds, according to Chief Investment Officer of Danantara, Pandu Sjahrir.
Speaking at the Indonesia Stock Exchange building on Monday, July 28, 2025, Pandu said that market optimism is palpable as the country approaches its 80th year of independence. “Hopefully, we’ll see the IHSG break through 8,000. Eighty years of Indonesia, 8,000 on the index—what a milestone that would be,” he said.
The Indonesian Composite Index (IHSG) surged by 118 points or 1.58% to close at 7,662.35 on Monday, briefly hitting a new year-to-date high of 7,667.98 during the first trading session, according to data from the Indonesia Stock Exchange (IDX).
Rate Cuts, Growth Data Seen as Catalysts
Senior Market Analyst at Mirae Asset Sekuritas Indonesia, Muhammad Nafan Aji Gusta, attributed the market rally to a more dovish interest rate outlook, both domestically and in the United States.
Bank Indonesia has cut its benchmark rate three times this year, injecting liquidity into the market and encouraging risk-taking. Meanwhile, the Federal Reserve is expected to trim rates twice more in October and November, potentially continuing the low-rate environment into 2026. “These trends will reduce corporate borrowing costs and increase appetite for equities,” Nafan told Investortrust.
However, he cautioned that persistent net foreign outflows remain a key hurdle. “To sustainably break 8,000, we need a meaningful return of foreign capital. As long as there’s consistent net selling by foreign investors, the index will need to climb in stages,” he said.
All Eyes on Q2 GDP
Investors are also waiting on Indonesia’s second-quarter GDP figures, expected to be released in early August. Nafan emphasized that stronger-than-expected economic growth would provide the necessary foundation for an extended rally. “If quarter-on-quarter GDP growth exceeds 2.5%, that would give the IHSG a solid base to break out,” he explained.
The convergence of macroeconomic stability, monetary easing, and optimism around Indonesia’s 80th Independence Day and the 48th anniversary of the modern capital market is setting the stage for a potential breakout—one that could mark a historic chapter in the country’s financial markets.
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