FX.co ★ Indonesia Stocks Remain Under Pressure as MSCI Review Looms

Indonesia’s IDX Composite dropped 116 points, or 2.0%, to 5,724 in early Friday trading, extending its decline for a third straight session and hovering near its weakest level since May 2021. Sentiment weakened amid softer U.S. futures following a mixed close on Wall Street, where the Dow hit a record high while the Nasdaq underperformed as investors rotated out of technology stocks.

Domestic factors deepened the pressure. Foreign investors have recorded net sales of over IDR 67 trillion so far this year, highlighting sustained capital outflows. At the same time, concerns intensified over speculation that MSCI may downgrade Indonesia to Frontier Market status ahead of its June 19 review.

The benchmark index is heading for a seventh consecutive weekly loss, down about 6% this week and 33% year-to-date, making it the worst performer among more than 90 major global indices. Selling was broad-based, led by financial, transportation, industrial, and infrastructure stocks. Perusahaan Gas Negara slumped 9.4%, while Pantai Indah Kapuk Dua fell 8.5%, Adaro Andalan dropped 7.5%, and Sentul City declined 6.3%.