LQ45 Index Underperforms Despite Broader Market Rally

Significant Performance Divergence

The LQ45 index has notably underperformed in 2025, with a mere 2.63% increase compared to the IHSG's substantial 22.23% gain from the start of the year to December 12, 2025. This performance gap highlights an unusual market dynamic where the broader index has significantly outperformed the blue-chip benchmark.

Stock Performance Analysis

Maximilianus Nico Demus, Associate Director of Research and Investment at Pilarmas Investindo Sekuritas, observed that most of the 45 stocks within the LQ45 index haven't recorded significant gains. The stocks that have shown growth primarily belong to conglomerates and second to fourth-tier stocks, rather than the traditional blue-chip companies typically associated with the LQ45 index.

Market Implications

This divergence in performance between the IHSG and LQ45 suggests a shift in market dynamics, where investors are potentially favoring broader market opportunities over traditional blue-chip stocks. The LQ45 index, known for comprising the most liquid and large-cap stocks on the Indonesia Stock Exchange, has historically been considered a barometer of the market's overall health.

Future Outlook

The underperformance of the LQ45 index relative to the IHSG may indicate changing investor preferences or sectoral rotations within the Indonesian stock market. As the market continues through 2026, investors will be watching closely to see if this trend persists or if the LQ45 reverts to its traditional role as a market leader.