FX.co ★ Market Reforms, Strong PMI Drive Indonesia Equity Rebound

In Indonesia, equities experienced a notable upswing, gaining 75 points, or 1.0%, to reach 7,997 during Tuesday's morning session. This significant rebound countered the nearly 5% drop seen in the previous session. The recovery was largely spurred by regulatory actions intended to stabilize markets, following concerns raised by MSCI regarding transparency. These measures included instructing sovereign wealth funds to direct asset managers to purchase equities and proposing to double the minimum free float to 15%. Investor sentiment was further buoyed by PMI data that indicated an acceleration in factory activity for January, marking six consecutive months of growth. On the trade front, Indonesia reported a USD 2.5 billion trade surplus for December, culminating in a USD 41.0 billion surplus for 2025. The regional optimism was supported by gains on Wall Street overnight. However, this momentum was somewhat tempered by inflation concerns, as the January inflation rate rose to 3.55%, surpassing Bank Indonesia's target ceiling due to increasing housing costs. Among the early performers were XLSmart Telecom, which surged 9.3%, Indah Kiat Pulp & Paper with a 7.3% increase, Elang Mahkota Teknologi up 3.6%, and United Tractors climbing 3.8%.