Jakarta. Indonesian stocks climbed 1.14% on Tuesday, with the Jakarta Composite Index (JCI) gaining 74 points to close at 6,599 after lawmakers confirmed Destry Damayanti as Bank Indonesia governor for the 2026-2031 term.

The House of Representatives approved Destry's appointment during a plenary session on Tuesday, giving markets greater certainty over the central bank's leadership and the direction of monetary policy.

The JCI traded between 6,535 and 6,608. Trading volume reached 59.7 billion shares, with turnover totaling Rp 20.7 trillion ($1.16 billion) across more than 2.6 million transactions. A total of 407 stocks gained, while 215 declined and 169 were unchanged.

Pilarmas Investindo Sekuritas said Destry's appointment provided certainty over the central bank's leadership and future monetary policy direction, offering a positive sentiment for the domestic market amid global economic uncertainty.

“Bank Indonesia's consistent policies to maintain monetary and economic stability have also remained in the market's focus. Meanwhile, several domestic economic indicators suggest that conditions remain relatively well maintained,” Pilarmas wrote in its Tuesday research note.

Indonesia’s Statistics Agency (BPS) reported that inflation stood at 0.21% month-on-month and 3.19% year-on-year in August 2026, keeping it within Bank Indonesia's inflation target range of 2.5% plus or minus 1%.

Indonesia's external position also received support from trade data. The country recorded a $120 million trade surplus in July 2026 after posting a deficit in June, helping support external economic stability.

However, domestic indicators also pointed to some challenges. Indonesia's Manufacturing Purchasing Managers' Index (PMI) fell to 49.8 in August from 50.2 in July, slipping back into contraction territory and signaling a slowdown in manufacturing activity.

Despite the positive domestic sentiment, Pilarmas said investors remained wary of escalating geopolitical risks.

Tensions between the United States and Iran have intensified again, raising concerns over oil supplies and higher energy prices. The situation could add to global inflationary pressures and fuel expectations of tighter monetary policy.

US forces attacked an island in the Strait of Hormuz, while Iran retaliated with attacks on the United Arab Emirates and Jordan.

“The developments mark a renewed escalation in fighting between the United States and Iran after about a month,” Pilarmas said.

Market concerns were also reinforced by comments from Federal Reserve Chair Kevin Warsh, who said there was still considerable work to be done before clearer evidence emerged that inflation was returning toward the 2% target.

Markets are now pricing in more than a 65% chance of a Fed rate hike in September, up from around 36% before Warsh's remarks.

“Rising interest-rate expectations could put pressure on risk assets, including equities, as investors once again assess the outlook for global liquidity and funding costs,” Pilarmas said.

Phintraco Sekuritas, meanwhile, said the JCI managed to remain in positive territory during the first trading session, indicating that domestic sentiment continued to provide support even as markets faced pressure from external developments.

Elsewhere in Asia, Hong Kong's Hang Seng fell 0.9%, while the Shanghai Composite was little changed at 3,985. Tokyo's Nikkei edged up 0.2% to 66,420, while South Korea's Kospi gained more than 0.2% to 6,835.

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