IHSG Finds Support After MSCI Shock as Officials See Buying Opportunity

JAKARTA, Investortrust.id — The Jakarta Composite Index or IHSG closed sharply lower on Wednesday, Jan 28, 2026 in Jakarta after a shock announcement from Morgan Stanley Capital International rattled investor sentiment, a move government and exchange officials said opened buying opportunities as Indonesia’s economic fundamentals remain solid. The steep decline, which briefly triggered a trading halt, was described as a temporary adjustment driven by sentiment rather than a reversal of the market’s underlying strength.

The IHSG ended the session down 659.67 points, or 7.35%, at 8,320 after sliding more than 8% intraday and activating a 30 minute trading halt. Total transaction value reached Rp 43.16 trillion, underscoring heightened volatility and heavy repositioning.

Finance Minister Purbaya Yudhi Sadewa said the market reaction overstated the implications of the MSCI announcement and did not reflect domestic economic conditions. He said fiscal and monetary coordination had put Indonesia on track for robust growth.

“Fiscal and monetary coordination alone can deliver six percent growth this year,” Purbaya said. “If stock prices fall because of issues that we know will be fixed before May, this should be a good time to buy.”

Purbaya said the IHSG decline was fueled by sentiment surrounding MSCI’s assessment and the presence of speculative stocks, combined with what he called an excessive market response. He stressed that the MSCI review was still in an early phase.

“I have spoken with the chairman of the Financial Services Authority, and everything will be addressed before May,” he said. “This is a temporary shock.”

Foreign investors booked a net sell of Rp 6.17 trillion during the session, flipping the year to date position into a net outflow of Rp 3.71 trillion. The heaviest selling was concentrated in major banking and commodity linked stocks, including BBCA, BMRI, BBRI, TLKM, and ANTM.

Despite the sell-off, exchange officials said domestic participation remained strong and that most market players stayed invested. The Indonesia Stock Exchange said foreign outflows accounted for only a small portion of total transaction value.

“We respect MSCI’s methodology, but this is not the end of the story,” said exchange president director Iman Rachman. “There are also positive aspects, and the process is still ongoing.”

All major sectors closed lower, with infrastructure, energy, property, and basic materials posting the steepest declines. Large capitalization stocks such as BREN, BRPT, and PTRO were among the biggest drags on the index.

Selective buying nevertheless emerged in several stocks, with a number of names recording sharp gains and hitting upper price limits. Market participants said the moves reflected early bargain hunting rather than a broad recovery.

Authorities said coordination between the exchange, the Financial Services Authority, and the central securities depository was being intensified to improve transparency in ownership data. Officials said the reforms would follow international best practices and strengthen the market over the longer term.

MSCI said its temporary measures were designed to limit index turnover risk while giving regulators time to improve disclosure. The index provider said it would reassess Indonesia’s market conditions after reviewing progress ahead of its May decision.

For policymakers, the episode is being framed as both a short term shock and an opportunity to reinforce confidence through faster reforms. Officials said clearer communication and improved transparency could help stabilize sentiment and support the market going forward.