FX.co ★ IDX Composite Plunges 7.35% Wednesday on MSCI Freeze

Indonesia's equities experienced a dramatic decline of 7.35%, closing at 8,321 on Wednesday, marking the most significant single-day drop in over 14 years. This steep decline was fueled by substantial sell-offs in large-cap stocks leading to widespread losses. The downturn followed MSCI's decision to temporarily suspend the rebalancing of Indonesia’s stock index due to concerns over ownership transparency, heightening the risk of the index being downgraded to frontier status. This development shook investor confidence, triggering an automatic trading halt designed to mitigate extreme market volatility. In the midweek trading session, foreign investors continued to withdraw, resulting in net outflows of IDR 6.13 trillion in the regular market and IDR 48.2 billion in the negotiated market. Key lagging stocks included Telkom Indonesia, which fell by 11.9%, and Bank Central Asia, down by 6.3%, highlighting the strain on major companies. Trading is set to resume today at 02:00 AM GMT, with a cautious sentiment expected to persist due to ongoing uncertainties surrounding MSCI’s pending review and its potential impact on market dynamics.