Singapore hits back over claims it rigged Indonesia’s stock market crash

Singapore’s state investor Temasek has denied involvement in Indonesia’s looming MSCI reclassification, following accusations that the city state’s sovereign wealth funds were pulling strings behind the scenes for their own gain.

On Wednesday, Fock Wai Hoong, head of Asia-Pacific at Temasek Global Investments, said the claims had “no basis” and were “patently untrue”.

Former Indonesian trade minister Muhammad Lutfi on Monday claimed that Singapore’s sovereign wealth funds, Temasek and GIC, were working behind the scenes to push for a downgrade of Jakarta’s market status.

“No one from Temasek – neither the institution nor the individuals working for the institution – have ever reached out to MSCI in order to influence any decisions they have ever made around any exchange across the region. We will leave it at that,” Fock said when asked about the allegations at the launch of the e-Conomy SEA Report 2026, jointly published by Google, Temasek and Bain & Company.

This Week in Asia has contacted GIC for comment.

Lutfi said Singapore’s state investors aimed to create market panic to acquire Jakarta’s assets at discounted prices. “The fall of our stock index this week was no coincidence, but the culmination of a well-designed scenario,” he said on social media.

MSCI announced on Friday it was launching a formal consultation to decide whether to downgrade Southeast Asia’s largest economy from “emerging market” to “stand-alone market” status.

The Jakarta Composite Index plunged 11.6 per cent on Friday – making it one of the world’s worst-performing benchmarks and wiping out around US$85 billion in market capitalisation. It fell a further 3.64 per cent to close at 4,996.00 on Monday, a six-year low.

The global index provider cited persistent concerns over structural issues in Indonesia’s market, including opaque ownership structures, highly concentrated shareholdings and coordinated trading practices. A final decision is expected by June 30 next year.

Lutfi’s comments sparked a strong reaction online, with many Indonesians urging their government to address core issues such as corruption and strengthen market fundamentals before pointing fingers at other states.

One user questioned the logic of the claim, coining it a “conspiracy theory” which insinuated that a country “as small as Singapore” could dictate the MSCI.

Another user said that while the former minister’s comments appeared to defend the sovereignty of Jakarta’s stock market, they needed to be backed by actions to eliminate practices that undermine transparency and credibility. “Patriotism does not mean turning a blind eye to the collapse of the market itself.”