Jakarta. Indonesian stocks fell 0.67% in early trading Wednesday as investors weighed rising external debt and the outlook for Bank Indonesia’s benchmark rate, while a global tech selloff added pressure to Asian markets.

Jakarta Composite Index (JCI) fell 41 points, or 0.67%, to 6,408 after 10 minutes of trading. The index moved between 6,373 and 6,414.

Trading volume reached 4.39 billion shares, with turnover of Rp 1.45 trillion ($81.18 million) across more than 269,000 transactions. A total of 185 stocks advanced, 312 declined, and 191 were unchanged.

Phintraco Sekuritas expects the JCI to move sideways in the 6,400-6,500 range as investors assess domestic economic and policy developments.

“Meanwhile, FTSE is continuing its evaluation of Indonesia’s stock market,” Phintraco Sekuritas said in its research note Wednesday.

The brokerage expects Bank Indonesia to keep its benchmark BI Rate at 5.75% at its policy meeting Wednesday, as inflation remains within the central bank’s target range and BI continues efforts to stabilize the rupiah and support economic growth.

The Deposit Facility Rate and Lending Facility Rate are also expected to remain unchanged at 4.75% and 6.5%, respectively. Investors are expected to pay close attention to BI’s guidance on the direction of monetary policy.

Credit growth is projected to accelerate to 13% year-on-year in July 2026 from 12.67% in June.

Phintraco also flagged Indonesia’s rising external debt as a negative sentiment. Bank Indonesia reported that external debt reached $454.4 billion in the second quarter of 2026, up 4.4% from a year earlier and higher than $433.4 billion in the first half of 2026.

The increase was driven by higher public external debt, including debt held by the government and central bank. Indonesia’s external debt-to-GDP ratio stood at 30.6% in the second quarter, with long-term debt accounting for 82.1% of total external debt.

“The increase in external debt is a negative sentiment, although the external debt-to-GDP ratio remains relatively manageable,” Phintraco said.

On the fiscal front, the government is targeting tax revenue of Rp 2,591.4 trillion in 2027, up 12.1% from the 2026 outlook. Tax expenditure is projected at Rp 632 trillion, an increase of 9.6%.

“The slower growth in tax expenditure is considered not a reflection of reduced incentives, but rather a sharpening of incentive targeting to make them more focused, measurable, and time-bound,” Kiwoom Sekuritas Indonesia said in its research Wednesday.

The 2027 draft state budget targets a fiscal deficit of Rp 671.2 trillion, equivalent to 2.40% of GDP, pointing to relatively strong fiscal consolidation.

The government is also expected to rely more heavily on tax extensification and intensification to generate an additional Rp 280.6 trillion in revenue in 2027 without increasing tax rates.

Global sentiment remained weak as investors rotated out of technology and AI stocks into defensive sectors.

“Investors also began focusing on the sustainability of the AI stock rally, particularly ahead of Nvidia’s earnings report on August 26 and Broadcom’s on September 2, which are considered important in determining the market’s momentum going forward,” Kiwoom said.

Wall Street closed lower Tuesday, with selling in the US bond market putting pressure on stocks, particularly yield-sensitive technology shares. The S&P 500 fell 0.69% to 7,691, while the Dow Jones Industrial Average declined 0.22% to 53,343. The Nasdaq Composite posted the steepest decline, falling 1.33% to 26,289.

Regional markets also came under pressure as of 8:50 a.m. Jakarta time. Japan’s Nikkei fell 2.22%, while South Korea’s Kospi plunged more than 6% earlier in the session, triggering a sell-side circuit breaker amid weakness in US semiconductor stocks.

Hong Kong’s Hang Seng Index declined 0.56%, while Shanghai’s SSE Composite Index fell 0.92%.

Add as a preferred source on Google +