UPDATE 4-Indonesian stocks fall 5% after last week's dramatic shake-up, $80 billion rout

"Today's move reflects a broader global equity selloff rather than anything Indonesia-specific," said Mohit Mirpuri, fund manager at SGMC Capital in Singapore. Indonesian regulators were set for an online meeting with MSCI on Monday afternoon, according to CNN Indonesia, to discuss the index provider's requests for more transparency on ownership data and free-float management of shares.

Indonesian stocks slid on Monday, weighed down by a selloff in commodities, after a tumultuous week during which a warning ‌from MSCI over transparency concerns triggered an $80 billion market rout and the country's top financial regulators resigned. The benchmark Jakarta Composite Index closed down about 5% after sliding nearly 7% last week, its steepest drop in a year, as a sharp decline in precious metals hurt investor sentiment that was already on eggshells. Other Asian ⁠markets were also lower. "Today's move reflects a broader global equity selloff rather than anything Indonesia-specific," said Mohit Mirpuri, fund manager at SGMC Capital in Singapore.

Indonesian regulators were set for an online meeting with MSCI on Monday afternoon, according to CNN Indonesia, to discuss the index provider's requests for more transparency on ownership data and free-float management of shares. MSCI did not respond to a request for comment.

"It's clearly all-hands-on-deck and we see strong intent from policymakers to find ​a workable solution," said SGMC's Mirpuri, who expects markets to remain choppy in the near term. Indonesia's Financial Services Authority late on Friday said its chief had quit along with three senior officials, including his deputy ‍and the head of capital markets. Indonesia Stock Exchange chief Iman Rachman also resigned on Friday. The departures came after MSCI flagged concerns about ownership and trading transparency in Indonesian stocks on Wednesday, warning that the market could be downgraded to "frontier" status if it did not resolve the issues by May. "The speed at which market optimism returns will depend on the government's ability to appoint credible leadership and to outline a clear, comprehensive reform roadmap for a healthier capital market," said Jeffrosenberg Lim, head of research at Maybank Sekuritas.

Nomura on Sunday became ⁠the latest ‌investment bank to lower its rating to "neutral" from "overweight" on Indonesian ⁠equities after similar moves by UBS and Goldman Sachs last week. Daniel Tan, portfolio manager at Grasshopper Asset Management, said the recent market reaction does not feel overdone and he expects uncertainty to continue until May, when MSCI is due to reassess Indonesia's market accessibility.

"If investors ‍have no exposure, they should adopt a wait-and-see approach before getting involved," he said. FISCAL CONCERNS RATTLE GLOBAL INVESTORS

Global investors have been rushing for the exits in Indonesia due to rising concerns about President Prabowo Subianto widening the fiscal deficit and expanding ​the state's involvement in financial markets. Investors are also worried about the central bank's independence after Prabowo's nephew, Thomas Djiwandono, was appointed as a Bank Indonesia deputy governor in January. Speaking to reporters after his ⁠appointment last week, Thomas said he would maintain Bank Indonesia's independence.

The abrupt sacking of widely respected finance minister Sri Mulyani Indrawati in September had stoked fears that hard-fought fiscal credibility could soon be eroded, weighing on the currency. The Indonesian rupiah was at 16,785 per U.S. dollar, not far ⁠from the record low of 16,985 hit in January.

Joshua Rout, portfolio manager at Franklin Templeton, said Indonesia over the past several years has generally been a good market to be overweight from a bond investor's perspective, noting the limits on fiscal deficits and broadly good growth. "If these favourable features get eroded the market will likely send a stern warning as it did when UK yields came under pressure a year or so ⁠ago," Rout said.

"And in Indonesia's case, expect it to have a much bigger impact on the exchange rate. It's always trickier in a world where capital flows are harder to come by too." Foreigners have ⁠sold a net of around $736 million worth of shares in ‌the Wednesday-Friday period, according to exchange data. They sold $1 billion worth of shares in all of 2025.

On Saturday, Indonesia's financial regulator named Friderica Widyasari Dewi as its interim chief and Hasan Fawzi as its executive chief for capital markets, a move that analysts said could help soothe investor nerves. Jeffrey Hendrik, IDX's director of business ⁠development, has been named interim chief of the exchange, CNN Indonesia reported on Monday.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)