The Jakarta Composite Index (IHSG) fell 16.70 percent in October 2026 compared with September, its worst monthly performance this year. The slide followed an MSCI public consultation, announced on 16 October, on reclassifying Indonesia’s stock market from emerging market to standalone market. A standalone market is excluded from major MSCI indices such as MSCI Emerging Markets and MSCI Frontier Markets. The final decision is due no later than 30 June 2027.
Investor concerns over investability
MSCI cited investor concerns about the investability of Indonesian shares, including the transparency of share ownership structures and alleged coordinated trading practices. The index had already fallen sharply earlier in the year. Monthly declines were recorded in January, February, March, April, May and June, with the steepest in March at 14.42 percent.
Monthly data from Stockbit show the index rose in July, by 10.51 percent, and in August, by 4.64 percent, before the September contraction of 6.96 percent. October’s fall was steeper than any of those moves.
Exchange and regulator respond
Iding Pardi, Director of the Indonesia Stock Exchange (BEI), said the exchange continues reforms to improve transparency, strengthen data quality and ensure better information access for investors. He said the work formed part of its commitment to following up MSCI’s concerns about the capital market.
BEI and the central securities depository KSEI have expanded the HSC methodology. Average free float among listed companies stood at 22.99 percent as of 30 September 2026, and 560 of 918 listed companies, or 61 percent, met the requirement.
