Ria Fortuna Wijaya, Muhammad Ghafur Fadillah, Associated Press, Jakarta – Jakarta Composite Index (JCI) plunged nearly 5% on Monday, with investors retreating ahead of crucial MSCI discussions on market reforms despite growing institutional interest in select stocks.
The index closed down 406.87 points or 4.88% at 7,922 after briefly sliding as much as 5% during the afternoon session, as risk appetite remained fragile amid lingering regulatory uncertainty.
JCI traded in a wide range of 7,820-8,313. Total trading volume reached 49.77 billion shares, with turnover of Rp 28.8 trillion ($1.71 billion) across more than 2.9 million transactions. Market breadth was sharply negative, with 58 stocks advancing, 720 declining, and 36 ending flat, reflecting heavy selling pressure.
Amid the broad sell-off, a handful of stocks recorded strong gains. Inter Delta (INTD) surged 24.80%, followed closely by Soho Global Health (SOHO), which rose 24.79%. Saraswanti Indoland Development (SWID) climbed 17.95%, while Indointernet (EDGE) advanced 12.55%.
On the losing side, MD Pictures (FILM), Golden Flower (POLU), Energi Mega Persada (ENRG), and GTS International (GTSI) each plunged 15%.
Market sentiment was weighed down by investor caution ahead of an anticipated meeting between MSCI and Indonesia's capital market authorities, including self-regulatory organizations and the Financial Services Authority (OJK). The discussions are expected to focus on MSCI's feedback on ownership data transparency, policy execution, and plans to raise the free-float threshold.
Despite the volatility, institutional investors have begun selectively accumulating fundamentally strong stocks, according to Danantara Chief Investment Officer Pandu Sjahrir, who said the market is starting to show early signs of normalization after last week's pressure.
"This is the first trading day after announcements made over the weekend. There was indeed a decline in trading activity, but the positive signal was net foreign buying in the first session," Pandu said at the Indonesia Stock Exchange building in Jakarta on Monday.
He noted that stocks with excessive valuations are undergoing natural corrections, while companies with solid fundamentals are attracting renewed institutional interest. "If you look at the top 10-15 buy and sell lists, the pattern we discussed on Sunday is now visible. Institutional investors are entering stocks with good fundamentals, attractive valuations, and sufficient liquidity," he said.
Pandu stressed the importance of a constructive response to MSCI's feedback, saying improving ownership transparency is the most immediate and critical step to restore global investor confidence. Any increase in free-float requirements, he added, should be implemented gradually and supported by consistent communication.
He also highlighted the need to expand pension fund participation through provisions under the Financial Sector Development and Strengthening Law (P2SK), noting that greater domestic institutional involvement could help lift valuations and improve market liquidity. "If pension funds can participate more, valuations will improve and stocks with free floats of 10-12% could rise to 15% or higher," Pandu said.
He confirmed that MSCI has given Indonesia until May for the initial implementation of reforms and said Danantara remains an active buyer, focusing on issuers with strong cash flows, solid fundamentals, attractive valuations, and adequate liquidity.
"The economy is strong, valuations are attractive, and the response from regulators and the exchange over the past week has been very fast," Pandu said. "Just five days after the policy announcement, corrective steps were already being prepared."
Pandu emphasized that current market conditions should not be viewed with excessive concern and urged investors to refocus on fundamentals and medium- to long-term prospects. "For stocks with strong fundamentals and attractive valuations, this can be a buying opportunity. And market participants have started to do that," he said, adding that clear communication on follow-up policies will be key to restoring confidence.
Separately, State Secretary Minister Prasetyo Hadi said President Prabowo Subianto was not angered by the sharp market decline. "The president understands that the stock market has its own dynamics. What matters is identifying the root of the problem and carrying out the necessary reforms," Prasetyo said in Sentul, Bogor, on Monday.
Brokerage Pilarmas Investindo Sekuritas said the JCI was also pressured by the sudden resignation of senior officials at the OJK and the Indonesia Stock Exchange, though regulators moved quickly to name interim replacements and outline eight measures to strengthen the capital market.
"In the short term, the market will continue to monitor the consistency of policy implementation and whether improved data transparency truly boosts investor confidence," Pilarmas said in a research note.
Foreign selling pressure also remains a concern. Bank Indonesia recorded net capital outflows of Rp 12.55 trillion from domestic financial markets between Jan. 26 and 29, 2026.
Regionally, Asian markets fell on Monday amid global uncertainty, driven by concerns over US monetary policy independence following President Donald Trump's nomination of Kevin Warsh as the next Federal Reserve chair.
South Korea's tech-heavy Kospi briefly halted trading before closing down 5.3% at 4,949. Samsung Electronics fell 6.3%, while SK Hynix sank 8.7%. In Japan, the Nikkei 225 dropped 1.3% to 52,655. Hong Kong's Hang Seng slid 2.5% to 26,694, while the Shanghai Composite fell 2.5% to 4,015.
On Wall Street last Friday, the S&P 500 and the Dow Jones Industrial Average each slipped 0.4%, while the Nasdaq Composite lost 0.9%.
Source: https://jakartaglobe.id/business/heavy-selling-hammers-jci-nearly-5-as-msci-reform-talks-nea