Indonesia’s Stock Market Poised for Growth in 2025
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The Indonesian Stock Exchange (IDX) is set to reopen on Thursday, January 2nd, 2025, with analysts predicting a strong start to the year. Positive economic indicators and the potential for a ”January effect” are fueling optimism for investors.
President Prabowo Subianto will officially open trading, delivering a speech to market leaders and officials.The Chairman of the OJK Board of Commissioners, Mahendra Siregar, will also be present to present a report. The Jakarta Composite Index (JCI), which closed 2024 at 7,079, is projected to rise, perhaps testing the 7,100 mark in early 2025.
Several factors contribute to this positive outlook. A new government policy implementing a 12% value-added tax (VAT) only on luxury goods is expected to boost consumer spending without impacting essential items.This, coupled with the anticipated January effect, creates a favorable surroundings for growth.
“A close at 7,079 at the end of 2024 provides a solid basis for optimism, supported by positive sentiment from domestic policy. This domestic sentiment includes the possibility of this happening January Effect,”
said Hendra Wardana, Founder of Stocknow, to Investor Daily on Wednesday, January 1st, 2025.
Wardana highlighted the strategic nature of the VAT policy, stating that it maintains the purchasing power of the general public while still meeting government revenue targets. Basic necessities, healthcare, education, and transportation remain subject to the lower 11% VAT rate or are even exempt.
“This policy gives a positive signal to the market because it is considered fair and shows the government’s commitment to maintaining economic stability, as well as meeting state revenue targets,” wardana added.
The potential for significant gains has investors focusing on specific stocks, with several key players expected to see increased activity.
While the January effect is not guaranteed, the confluence of positive economic news and the potential for this seasonal market anomaly creates a compelling investment chance.The Indonesian market’s performance will be closely watched by global investors in the coming months.
Editor: Jahari Mahardhika (jauhari@investor.co.id)
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Indonesia’s Stock Market: Analysts Predict a Bullish Start to 2025
following a solid close in 2024, Indonesian stocks are poised for a strong start to the new year. A combination of positive economic indicators, a new government tax policy aimed at boosting consumer spending, and the potential for the “January effect” are fueling optimism among experts.
Predicting a Positive Opening
world-today-news.com Senior Editor: Richard Hart asks:
“Many analysts are predicting a strong start for the Jakarta Composite Index (JCI) this week. What are yoru thoughts on the JCI’s performance in these early months of 2025?”
Dr. Sri Mulyani Indrawati, Senior Economist, Center for strategic and International Studies: “The JCI’s close above 7,000 at the end of 2024 is certainly a promising sign. coupled with the optimism surrounding the new VAT policy and anticipation of the January effect, I believe we could see the JCI testing the 7,100 mark in the coming weeks. However,global market fluctuations also play a role,so it’s important to remain cautious.”
The Impact of the New VAT Policy
Richard Hart: “The new VAT policy has made headlines.
Dr. Sri Mulyani: “It’s a strategic move by the government. by applying a 12% VAT only on luxury goods, they aim to generate revenue without significantly impacting the purchasing power of the general population
It’s seen as a fair approach that balances economic growth with fiscal obligation.
Richard Hart: “The new VAT policy has made headlines.
Dr. Sri Mulyani: “It’s a strategic move by the government. by applying a 12% VAT only on luxury goods, they aim to generate revenue without significantly impacting the purchasing power of the general population
It’s seen as a fair approach that balances economic growth with fiscal obligation.
Richard Hart:
“What are the potential risks or challenges that investors should be aware of in the current market surroundings?
Dr. Sri Mulyani:
While the outlook is generally positive, global economic uncertainties persist.Inflationary pressures in some regions could have a ripple effect, and geopolitical tensions remain a concern. Investors need to remain informed and diversify their portfolios to mitigate these risks.”
