Six months is not enough to put together a new set of rules, and that\nis not what is being awaited.<\/p>\n
Jakarta (ANTARA) \u2013 On Friday morning, 16 October, retail investors\u2019\nstock-trading apps \u201ccaught fire\u201d shortly after the market opened. The\nJakarta Composite Index (JCI) immediately fell by 8.01 per cent,\nprompting the Indonesia Stock Exchange (IDX) to impose a trading\nhalt.<\/p>\n
By the market\u2019s close that evening, the index stood at 5,185.10, down\n11.57 per cent in a single day. The last time it suffered a daily fall\nof that magnitude was during the 1998 crisis.<\/p>\n
The trigger came from New York a few hours earlier. MSCI, the index\nprovider whose benchmarks are used by global investment funds, opened a\nconsultation on moving Indonesia from the emerging-market group to\nstandalone-market status, a category outside its main index\nfamilies.<\/p>\n
Standalone-market status would place Indonesia\u2019s capital market\nalongside those of Jamaica, Panama and Palestine.<\/p>\n
The reasons cited by MSCI did not concern economic growth or listed\ncompanies\u2019 profits. According to MSCI, global market participants were\nconcerned about persistently opaque share ownership structures and\nsuspected coordinated trading that distorts price formation.<\/p>\n
For anyone active in the stock market, neither issue will sound\nunfamiliar. Almost every active market participant has seen large-cap\nshares multiply in value in a short period, while the proportion of\nshares genuinely available to the public remained small.<\/p>\n
A question usually confined to investor discussion groups has now\nappeared in an official document from the world\u2019s largest index\nprovider: who is really setting prices on the Jakarta exchange?<\/p>\n
The key term is free float: the proportion of shares available for\npublic trading. On paper, the figure is recorded in company reports. In\npractice, some shares listed as publicly owned may be held by parties\nconnected to the controlling shareholder.<\/p>\n
This loophole prompted MSCI, from January 2026, to freeze several\nchanges to Indonesian stock indices, including increases in foreign\ninclusion factors, and to stop adding new companies to its\nrecommendations for global institutional fund managers.<\/p>\n
On the same day the index plunged, the Financial Services Authority\n(OJK) disclosed findings from investigations showing how the loophole\noperated.<\/p>\n
Hasan Fawzi, OJK\u2019s Chief Executive for Capital Markets, Derivatives\nFinance and Carbon Exchanges, said that shares offered in the initial\npublic offerings of two Barito Group companies, PT Barito Renewables\nEnergy Tbk (BREN) and PT Petrindo Jaya Kreasi Tbk (CUAN), had from the\noutset been allocated to groups connected to their controlling\nshareholders.<\/p>\n
Those parties received very large guaranteed allocations while\nconcealing their identities, concentrating ownership within particular\ngroups.<\/p>\n
In the case of PT Dian Swastatika Sentosa Tbk (DSSA), OJK found\nplanned and structured market manipulation by individual and\ninstitutional clients operating through several brokerage firms, causing\nthe share price to rise abnormally.<\/p>\n
Administrative fines amounted to Rp1.5 trillion in the DSSA case,\nRp500 billion for BREN and Rp100 billion for CUAN. The investigation\ncovered securities-company directors, custodian banks and recipients of\nguaranteed allocations, while OJK continues to trace the flow of\nfunds.<\/p>\n
For retail investors, the findings explain an experience that has\nlong been difficult to prove. When most of a company\u2019s shares are\ncontrolled by one circle, the price on screen is formed by a very\nlimited supply, rather than purely by the forces of supply and\ndemand.<\/p>\n
Retail investors who enter later are buying from a pool whose size\nand ownership they have never truly known.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/six-months-to-convince-msci-1792309849", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }