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Indonesian stocks suffer worst day since 1998 after MSCI downgrade warning

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Neutral summary

Indonesian stocks suffered their worst day since 1998 on Friday, October 16, with the "Jakarta Composite" index falling roughly 11–12%, according to various outlets. The sell-off followed a warning from US index provider MSCI that it no longer considers Indonesia's stock market worthy of developing market status and is launching a consultation on reclassifying it as a standalone market. Earlier this year, MSCI said investors had raised concerns about "ongoing opacity in shareholding structures" as well as coordinated trading behaviour that affected price information. The "Jakarta Composite" opened down 8%, triggering a 30-minute trading halt, before losses deepened. "Nikkei Asia" and "InfoMoney" report this was the largest one-day drop in 28 years, and the market has become the world's worst performer this year. Indonesian Financial Services Authority chair "Friderica Widyasari Dewi" said the regulator respects MSCI's plan, while Deputy Coordinating Minister for Economic Affairs "Drajad Hari Wibowo" urged investors not to panic. State investment fund "Danantara" pledged $5 billion to domestic companies. "The New York Times" links the crisis of investor confidence to the economic policies of President "Prabowo Subianto".

How it was framed

Outlets: 19. Countries: 11. Facts in the shared core: 3.

Publication timeline

  1. · Financial Times (outlet profile)

    MSCI warns it may cut Indonesia from main indices. Warning from global index provider fuels concerns about investability in south-east Asia’s biggest economy

  2. · Nikkei Asia (outlet profile)

    MSCI considers Indonesia index downgrade as consultation process begins

  3. · Channel NewsAsia (outlet profile)

    Indonesian stocks dive 11% as MSCI weighs market reclassification. The US firm said earlier this year that investors had raised concerns about "ongoing opacity in shareholding structures" as well as coordinated trading…

  4. · Antara (English) (outlet profile)

    OJK respects MSCI plan to reclassify Indonesia's market. Indonesian Financial Services Authority (OJK) Board of Commissioners Chair Friderica Widyasari Dewi here on Friday ...

  5. · Nikkei Asia (outlet profile)

    Indonesia stocks plunge after MSCI signals possible downgrade in status

  6. · Euronews (outlet profile)

    Indonesian stocks plunge 11% as MSCI proposes emerging market downgrade. The index provider is weighing reclassifying the country from emerging market to standalone status, potentially forcing funds tracking MSCI's emer…

  7. · Valor Econômico (outlet profile)

    Bolsas da Ásia sobem após alívio em IA, mas Indonésia despenca. As bolsas asiáticas subiram em sua maioria nesta sexta-feira, um dia após uma liquidação de papéis de tecnologia arrastar os mercados para baixo, enquanto…

  8. · The New York Times (outlet profile)

    Indonesian Stocks Plunge as MSCI Threatens to Drop Market from Indexes. The potential downgrade by MSCI, an influential index provider, adds to a deepening crisis of investor confidence in the economic policies of Indon…

  9. · Интерфакс (outlet profile)

    Рынок акций Индонезии рухнул максимально с 1998 года на заявлении индексного провайдера MSCI. Индексный провайдер MSCI Inc. сообщил, что более не считает оправданным сохранение фондового рынка Индонезии в категории "раз…

  10. · RFI (outlet profile)

    Indonésie: la Bourse de Jakarta dégringole de 11% après l'annonce d'une possible reclassification. Le principal indice boursier d'Indonésie a dégringolé de quelque 11% ce vendredi matin après l'annonce d'une possible re…

  11. · Antara (English) (outlet profile)

    IDX calls for long-term focus amid market pressure, MSCI review. The Indonesia Stock Exchange (IDX) has urged investors to stay rational and maintain a long-term perspective after ...

  12. · Handelsblatt (outlet profile)

    Südostasien: MSCI droht Indonesien mit Index-Rauswurf – Börse verliert heftig. Der Indexanbieter hält Reformen zur Markttransparenz in Südostasiens größter Volkswirtschaft für nicht ausreichend. Das hat Folgen für bekan…

  13. · Nikkei Asia (outlet profile)

    Indonesia stocks post largest drop in 28 years after MSCI warns of downgrade

  14. · InfoMoney (outlet profile)

    Ações da Indonésia têm a maior queda em 28 anos após alerta de rebaixamento da MSCI. A queda de sexta-feira agravou um ano já difícil para as ações locais, consolidando sua posição como o mercado de pior desempenho do m…

  15. · Fortune (outlet profile)

    Indonesia’s Danantara pledges $5 billion to home-grown companies as MSCI once again threatens a downgrade. Chief investment officer Pandu Sjahrir says consumer stocks are cheap; MSCI's proposed standalone reclassificati…

  16. · Antara (English) (outlet profile)

    Deputy minister urges investors not to panic over MSCI announcement. Deputy Coordinating Minister for Economic Affairs Drajad Hari Wibowo has urged investors not to panic over Morgan ...

  17. · Bangkok Post (outlet profile)

    Jakarta shares plunge after downgrade shock. JAKARTA — Indonesia’s stock market is no longer worthy of “emerging market” status, MSCI said ‌on Friday, laying out a plan to remove it from a s…

  18. · Wirtschaftswoche (outlet profile)

    MSCI: Indonesien steht vor dem Börsen-Abstieg. Der Indexanbieter MSCI will Indonesien den Status als Schwellenland entziehen, indonesische Aktien stürzen ab. Was die drohende Herabstufung für Anleger bedeutet.

  19. · Valor Econômico (outlet profile)

    Bolsas em NY abrem em direções opostas com cautela sobre ‘techs’ e Warsh em foco. Os principais índices de ações de Nova York abriram em direções opostas nesta sexta-feira, sem apresentar variações muito expressivas, en…

  20. · Valor Economico (outlet profile)

    Bolsas em NY abrem em direções opostas com cautela sobre ‘techs’ e Warsh em foco. Os principais índices de ações de Nova York abriram em direções opostas nesta sexta-feira, sem apresentar variações muito expressivas, en…

  21. · www.rbc.ru (outlet profile)

    Фондовый рынок Индонезии пережил сильнейшее падение почти за 30 лет. Поводом для падения стало предупреждение американского индексного провайдера

  22. · El Comercio (Perú) (outlet profile)

    Wall Street abre mixto arrastrado por los fabricantes de semiconductores. Wall Street abrió mixto este viernes y su principal indicador, el Dow Jones de Industriales, sumaba 0,48% mientras los fabricantes de chips volví…

  23. · UOL (outlet profile)

    Bolsa da Indonésia despenca 11,6%, maior queda desde 1998, após ameaça de exclusão da MSCI. A Bolsa da Indonésia despencou nesta sexta-feira (16), depois que a provedora global de índices MSCI alertou que poderia exclui…

  24. · CNN Brasil (outlet profile)

    Bolsa da Indonésia tem pior dia desde 1998 após alerta de reclassificação. Índice Jakarta Composite despencou quase 12% nesta sexta-feira; liquidação se intensificou depois queda abertura em queda de 8%, acionando uma i…

Factual core

  • The MSCI warning concerned a potential downgrade of Indonesia's market status.
  • The main stock index of Indonesia plunged about 11% on Friday morning.
  • Indonesia's stock market experienced its sharpest fall in nearly 30 years.

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