FX.co ★ Heavy Selling Halts IDX Again Amid Downgrade Risks

Indonesia's IDX Composite experienced a significant drop of 666 points, or 8%, reaching 7,654 during Thursday morning's trading session. This decline extends the previous day's downturn and led to another suspension of trading. The intensified sell-off followed a downgrade by Goldman Sachs on Indonesian stocks, which highlighted potential multi-billion-dollar outflows after MSCI's initiative to improve ownership transparency. There is a rising concern that the market might be downgraded to frontier status. This cautionary note has amplified investor unease as Southeast Asia's largest economy is currently dealing with continuous foreign capital exits, a depreciating currency, an expanding fiscal deficit, and worries regarding the central bank's independence. The selling pressure affected a broad range of sectors, with financial, transport, industrial, and healthcare stocks showing notable declines. Among the hardest hit were Darma Henwa, falling by 15%, Archi Indonesia by 14.4%, Aneka Tambang by 13.6%, Bank Central Asia by 7.1%, and Bank Rakyat Indonesia by 5.9%, highlighting the impact on both blue-chip stocks and cyclical sectors.