Indonesia Stocks Hit Six-Year Low as MSCI Proposes Reclassification

Indonesia’s Jakarta Composite fell more than 5% Monday, Oct. 19, to a six-year low after index provider MSCI proposed reclassifying the country, a move estimated to prompt $5.6 billion in passive outflows. The proposal would move Indonesia directly from emerging-market status to a standalone market, potentially removing its stocks from major global indexes. The Jakarta Composite opened down 8% on Oct. 16, the first trading session after MSCI announced its consultation, triggering a 30-minute trading halt. Intraday losses exceeded 11%. The $5.6 billion scenario assumes Indonesia is fully removed from MSCI’s emerging-market indexes.

Source: TokenPost