(May 13): The Indonesian rupiah bounced back after touching a record low on Wednesday and equities descended to a one-year trough after index provider MSCI removed six local companies from its domestic global standard index following a quarterly review.
This was the latest blow to Southeast Asia’s largest economy, which is already grappling with crude price shocks and concerns about fiscal discipline, central bank independence and stock market regulation.
Stocks in Jakarta fell as much as 1.9% to 6,726.575, the lowest level since late April 2025, while the rupiah weakened to an all-time low of 17,535 a dollar before strengthening slightly to 17,480.
“Today’s reaction will likely be negative given the expected passive outflows and Indonesia’s lower MSCI EM weighting post-rebalance,” said Mohit Mirpuri, a fund manager at SGMC Capital in Singapore.
MSCI’s removal of six companies from the global standard index included four of Indonesia’s top 20 stocks by market capitalisation: Barito Renewables Energy, Chandra Asri Pacific, Dian Swastatika Sentosa and Amman Mineral International. The four stocks plunged between 8% and 15%.
Heavyweight utilities firm Barito Renewables hit its lowest level in more than two years, while chemicals firm Chandra Asri Pacific touched its weakest level in five weeks.
The global index provider earlier extended its review of the Jakarta stock market to June to assess reforms in the Southeast Asian nation.
The Indonesian economy recently faced a number of setbacks: MSCI’s transparency concerns triggered a US$80 billion market rout that prompted new regulations, while Moody’s cut the nation’s credit rating outlook to negative due to unpredictable policymaking.
As of Tuesday, foreign investors had sold about US$2.24 billion worth of Indonesian stocks so far this year, compared to net selling of US$1.03 billion in 2025, based on data from the Indonesian stock exchange website.
Domestic market conditions are still quite fragile and local investor nervousness has also increased after the USD/IDR pair broke above 17,500 ahead of a long weekend, said Liza Camelia Suryanata, head of equity research at Kiwoom Securities Indonesia.
Indonesian markets will be closed on Thursday and Friday for a public holiday.
“For the medium-term, we target IDX (JKSE) to recover to ~7300, once this capital market reformation bears fruit,” she said.
The Thai baht steadied at 32.34 per dollar with the central bank’s April meeting minutes underscoring the need for a coordinated policy mix and structural adjustments to manage the heightened risks posed by the US-Israeli war on Iran.
Bangkok shares jumped as much as 2.5%, their biggest single-day rise since late March.
Shares in Manila slipped 0.7%, with Jollibee Foods emerging as the hardest hit, shedding nearly 10% after it was removed from MSCI’s Philippine global standard index.
Uploaded by Lam Seng Fatt