Dear Clients,

For the first time since September 2020, the Jakarta Composite Index (JCI) experienced a trading halt yesterday. The 30-minute halt was triggered after the index fell by more than 5%, serving as a mechanism to cool down selling pressure.

However, after the halt was lifted—just 10 minutes before the end of the first trading session—the JCI continued to slide, eventually plunging 7% to its lowest level of 6,100. Unlike past trading halts, such as those triggered by the COVID-19 crisis, yesterday's market turmoil came without an obvious, immediate catalyst.

Market Reaction

Foreign investors continued their sell-off, leading to a total year-to-date (YTD) fund outflow of IDR 245 trillion. Based on trading data from March 18, 2025, the market saw a net sell of IDR 2.57 trillion. Most of the sell-off happened to be the Big Four Banks.

Meanwhile, several conglomerate-owned stocks—whose market caps had surged due to domestic inflows—faced a sharp correction. Weak fundamentals and profit-taking by domestic investors, amid volatile price movements, contributed to the sell-off.

What Caused the Correction?

We think the market sentiment was clouded by:

  • Uncertainty over government policies – Investors are cautious about potential shifts in economic direction.
  • Cabinet reshuffle rumors – Speculation of changes in key ministerial positions (later dismissed as false) added to volatility.
  • Anticipation of the U.S. Federal Reserve’s decision – The looming Fed announcement created additional nervousness, particularly with the ongoing Rupiah depreciation.

How We’re Managing The Portfolio

The market downturn demanded immediate action as our portfolio faced significant losses. We maintained our investment strategy, acquiring undervalued blue-chip stocks, especially banks with strong rebound potential. Our focus remains on delivering sustainable returns through a blend of quality blue-chip and momentum-driven equities.

Our Recommendation

Equity markets will stay volatile, but the drop is a buying opportunity. We suggest partial equity investment with caution.

  • Consider Simpan Cash Fund for liquidity and stability, outperforming deposits.
  • For long-term growth, Simpan Sustainable Equity Fund offers strong stocks aligned with Indonesia’s economy. Stay invested, strategic, and adaptable for long-term growth.
  • Wealth clients could consider diversify towards USD Private Markets. Contact us for more info.

We're committed to cutting through the noise and keeping you informed every step of the way as we manage your funds. Thank you.