FTSE Russell Removes Four Indonesian Shares; Foreign Funds Worth Rp 4 Trillion Flee Stock Exchange
Jakarta — FTSE Russell’s decision to remove four Indonesian shares from the FTSE Global Equity Index Series (GEIS) has triggered a foreign capital outflow (foreign outflow) of up to Rp 4 trillion from the domestic stock market.
The foreign selling pressure has been cited as one of the factors contributing to the Jakarta Composite Index (IHSG) weakening over eight consecutive trading days.
FTSE Russell previously announced the removal of four Indonesian shares in a report titled “June 2026 Quarterly Review”, published on Saturday (23 May 2026).
The four shares being removed are PT Dian Swastatika Sentosa Tbk (DSSA), PT Daaz Bara Lestari Tbk (DAAZ), PT Hillcon Tbk (HILL), and PT Mulia Industrindo Tbk (MLIA).
Investment managers using FTSE as a benchmark for Exchange-Traded Fund (ETF) products have already undertaken front-running activities or portfolio adjustments in advance. This activity has triggered the exit of approximately Rp 4 trillion in foreign funds from the domestic stock market.
“The outflow has actually started with front-running by investment managers (IMs) using FTSE as a benchmarking index for ETFs, with foreign outflows of around Rp 4 trillion,” said one analyst when contacted by Kompas.com on Saturday (23 May 2026).
“This is what has caused the IHSG to weaken for eight consecutive days,” he explained.
However, he assessed that the selling pressure from foreign investors resulting from the removal of four Indonesian shares from the FTSE Russell index will not be as significant as when Morgan Stanley Capital Indonesia (MSCI) removed six Indonesian shares from its standard index.
This is partly because front-running has already occurred earlier, and the asset under management (AUM) using FTSE as a benchmark is far smaller.
“No, aside from front-running, fund management with FTSE benchmarking only has one-third of the AUM compared to indices with MSCI benchmarking,” he added.
The analyst previously noted that the removal of Indonesian shares from the MSCI index triggered a foreign capital outflow. This occurred because passive fund managers are generally obliged to adjust their portfolio composition in line with changes to the latest index.
“Certainly, this will cause outflows from passive fund managers, creating significant pressure on shares entering deletion with potential impact of Rp 22 trillion,” he concluded.
FTSE Russell stated that the decision to remove Indonesian shares becomes effective after market close on 19 June 2026. However, index review results may still undergo revision until market close on Friday, 5 June 2026.
“Please note that changes to index review results contained in the attached file may still be revised until market close on Friday, 5 June 2026. From Monday, 8 June 2026, changes to index review results will be considered final. Any subsequent changes will typically only be considered in exceptional circumstances, in accordance with FTSE Russell’s index recalculation policy and guidelines,” FTSE Russell stated in its official announcement.