Indonesian stocks slumped to their lowest level in 14 months while the rupiah hit another record low, reflecting investor concern over high oil prices straining the country's finances. The Jakarta Composite Index plunged 4.9%, with materials leading declines as that subsector tumbled more than 9%. The rupiah weakened 0.5% against the dollar, becoming Asia's worst performer.

The decline follows data showing Indonesia's trade surplus nearly vanished in April as rising oil import prices outpaced export gains. Consumer inflation accelerated to 3.08% in May, exceeding economist estimates and moving further above Bank Indonesia's target range. This economic pressure compounds concerns about fiscal slippage due to elevated energy costs.

Investor confidence continues to erode amid fears of potential credit rating downgrades and MSCI market reclassification risks. The JCI's 30% decline in 2026 makes it the worst performer globally among tracked indexes. "Concerns that Indonesia's credit rating might be downgraded due to higher risk of a widening fiscal deficit are weighing on stocks," according to former JPMorgan strategist Henry Wibowo.