The Jakarta Post
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search results
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search results‘Panic’ blamed for record foreign outflows from stock market
Analysts say Friday’s stock market rout was driven by panic-selling following MSCI’s consideration to reclassify Indonesian equities in its global indexes, pushing cumulative foreign outflows for the year to a historical high of Rp 88.19 trillion.
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
A man uses his mobile phone in front of a reflection of an electronic board displaying stock prices on Oct. 14 at the Indonesia Stock Exchange (IDX) building in South Jakarta. (JP/Iqro Rinaldi)
A
nalysts say Friday’s stock market rout was driven by panic-selling and investors' risk-off response to MSCI’s proposal to reclassify Indonesian equities in its global indexes, even though a final decision will not happen until the end of June 2027.
Nafan Aji Gusta, senior technical analyst at Mirae Asset Sekuritas told The Jakarta Post on Sunday that the downgrade risk could intensify sell-off pressure and market volatility due to a potential decline in foreign capital allocations, particularly from passive funds benchmarking to the MSCI index.
He added that the sharp correction also reflected “trust issues” among investors over transparency, liquidity and governance credibility in the capital market.
The Indonesia Stock Exchange (IDX) suffered a massive foreign sell-off as investors were spooked by MSCI’s proposal to categorize Indonesia as a “standalone market”.
Stock market records show net foreign sell orders of Rp 3.34 trillion (US$185.2 million) on Friday, pushing the cumulative foreign outflows since the start of the year to a historical high of Rp 88.19 trillion.
Record net foreign selling
Friday’s net foreign sell surpassed the worst levels seen during the coronavirus pandemic in 2020 and the 2008 global financial crisis, which stood at Rp 53.84 trillion and Rp 50.17 trillion for the full calendar year, respectively.
