FTSE Russell Defers Indonesian Stock Additions Amid Market Reforms

FTSE Russell has announced a continued deferral on adding Indonesian stocks to its indexes until December to evaluate market reforms. The decision comes amid scrutiny from global index providers on Indonesia's market transparency and investability. Some classification changes will proceed in September.

FTSE Russell announced on Tuesday that it will defer adding Indonesian stocks to its indexes until at least December. This decision allows for an extended observation period to evaluate the success of ongoing market reforms intended to improve transparency and integrity in Indonesia’s capital markets.

The pause, which has been in place since February, aligns with increased scrutiny of Indonesian markets by global index providers. MSCI extended its review of the market until November, while S&P Dow Jones Indices cautioned that Indonesia might be downgraded to frontier-market status.

Despite the deferral, FTSE Russell will implement certain classification changes in September. These include industry classification updates, quarterly share adjustments, decreases in free-float percentages, capping updates, and deletions impacted by index eligibility requirements.