IDX calls for long-term focus amid market pressure, MSCI review

Jakarta (ANTARA) - The Indonesia Stock Exchange (IDX) has urged investors to stay rational and maintain a long-term perspective after local stocks nose-dived following a proposal by global index provider MSCI to reclassify the market, an official said Friday.

"We emphasized that investors should adopt a long-term orientation," said Iding Pardi, director of development at the IDX, advising market participants to base decisions on corporate fundamentals rather than short-term price swings or crowd sentiment.

The benchmark Jakarta Composite Index (IHSG) plunged 630.78 points, or 10.76 percent, to close the first trading session Friday at 5,233.00.

Earlier in the morning, the sharp drop triggered a mandatory 30-minute trading halt after the index opened down 8.01 percent.

The heavy sell-off followed MSCI's announcement Thursday that it is opening a consultation with global investors to potentially downgrade Indonesia from "Emerging Market" to "Standalone Market" status due to ongoing concerns over investability, opaque ownership structures, and alleged coordinated trading.

Pardi noted that severe market corrections can provide strategic entry points for investors willing to look past short-term volatility.

"I urge investors to act rationally; do not simply follow the crowd. Decisions to buy or sell should be driven by the fundamentals of the market and the companies themselves," Pardi stated.

MSCI will collect feedback from market participants through April 30, 2027, with a final decision expected before June 30, 2027.

While Indonesian regulators have announced reform initiatives, MSCI stressed that authorities must demonstrate consistent implementation and measurable, sustained improvements to preserve the country's status.

Translator: Muhammad Heriyanto, Cindy Frishanti Octavia
Editor: Aditya Eko Sigit Wicaksono
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