The sharpest fall since 1998: Indonesia's stock exchange in collapse

Indonesia's main stock index fell nearly 4% after plunging more than 11.5% on Friday, the sharpest daily drop since 1998. This follows MSCI's announcement that it is considering downgrading Indonesia's market status due to concerns over transparency and enforcement. Since the start of the year, the index has lost nearly 40%.

Indonesia's main stock index, the Jakarta Composite Index, fell nearly 4% today (Monday), following a plunge of more than 11.5% on Friday. This is the sharpest daily drop since the Asian financial crisis in 1998. The steep declines come on the heels of an announcement by index provider MSCI that it is considering downgrading Indonesia's market status from 'emerging market' to 'standalone market'. The reasons for the review are concerns over opaque stock ownership, suspected coordinated trading, and weak regulatory enforcement. Since the start of the year, the index has lost nearly 40%, making it the worst-performing market in Asia. In response, the Indonesia Stock Exchange reduced the maximum daily decline allowed for a stock from 15% to 7%, in an effort to stem the rout. The Indonesian government has expressed frustration with MSCI's move. A final decision is expected by the end of June 2027.