Indonesia expels tightly held firms from Jakarta index
Indonesia is removing closely held companies from its Jakarta index to head off a possible downgrade by index provider MSCI. Stock exchange leaders will meet MSCI on Monday.
By Standard Topic. AI-generated from the reporting listed under Coverage. Published . Updated .
This story is no longer being updated. It reflects reporting up to .
What happened
Indonesia is removing tightly held companies from its Jakarta stock index in an effort to avoid a downgrade by global index provider MSCI, which has repeatedly raised concerns about investability in the country. Leaders of the Indonesian stock exchange are set to meet MSCI on Monday after the provider said it could downgrade the market. The threat has triggered a stock rout and weakened the rupiah, increasing pressure on Bank Indonesia to raise rates.
Why it matters
MSCI's threat to cut Indonesia's market to standalone status has rattled stocks and the rupiah. Analysts say stricter enforcement may be needed to rebuild investor confidence.
Timeline
- Oct 19, 11:59 AM ET: Indonesia moved to expel tightly held companies from the Jakarta index to avoid an MSCI downgrade.
- Oct 19, 12:50 AM ET: Leaders of Indonesia's stock exchange are scheduled to meet MSCI on Monday.
- Oct 19, 11:54 PM ET: Ari Jahja, head of Indonesia research at Macquarie Capital, called for stricter enforcement and greater transparency on shareholding and free float.
- Oct 19, 11:59 PM ET: Bank Indonesia faces growing pressure to raise interest rates after the MSCI threat triggered a stock rout.
Coverage
- Bank Indonesia faces mounting pressure to hike after MSCI threat fuels market rout (CNBC)
- Indonesia needs stricter enforcement to mitigate MSCI downgrade risk: Macquarie Capital (CNBC)
- Indonesia expels tightly held companies from Jakarta index in bid to avoid MSCI downgrade (Financial Times)
- Indonesia stock market leaders to meet MSCI on Monday, official says (Reuters)
- Indonesia Stock Market Faces MSCI Exile over Poor Governance (asiasentinel.com)
More from Business
- Musk pledges SpaceX stock for every American child next year
- Small businesses sue to halt Trump's tariffs on Canadian imports
- Houthi attacks force Saudi Arabia to postpone investor conference
- Bank of America keeps October rate hike call despite markets
- Connecticut man admits losing $1.16M of investor crypto funds
- AI stock selloff keeps markets jittery as CoreWeave debt worries spread