The JCI has continued to edge higher, approaching record territory. On the surface, the market looks euphoric. Foreign inflows remain strong, the government’s outlook speech projected confidence with an ambitious 2026 growth target, and global liquidity is easing in line with lower interest rate trends. At first glance, there seems little cause for concern.

But a closer look shows the story is more nuanced. The rally so far has not been broad-based. Several sectors have already run too far with valuations increasingly difficult to justify, while others are only starting to catch up. Energy, infrastructure, healthcare, and technology have posted strong gains over the past year. In contrast, property, industrials, and consumer cyclicals remain in a catch-up phase. Even after double-digit gains in the past month, consumer cyclicals are still negative on a 12-month view, while property and industrials continue to trade at more reasonable valuations compared to sectors that have already surged. This suggests market opportunities are shifting, some sectors look full, while others still have room to run.

From our technical analyst perspective, the JCI lost momentum after briefly breaching the psychological 8,000 level. In the near term, the index looks vulnerable to a correction, with gaps at 7,800 and 7,630 that may be filled. Profit-taking risks are therefore rising at current levels.
 

Overall, the JCI’s rise so far reflects strong optimism, but it also comes with caution as gains have not been evenly distributed across sectors. With the index already at elevated levels, uneven valuations, and technical signals pointing to potential short-term corrections, the market now demands greater selectivity. Investors need to be more discerning in distinguishing stocks that appear overpriced from those that still hold room for growth, especially heading into 2026 when government policy direction and the trend of lower interest rates could serve as key catalysts.