MSCI Rebalancing Opens Opportunities for Accumulating Blue Chip and Small Cap Stocks
REPUBLIKA.CO.ID, JAKARTA – Capital market practitioner and Co-founder of PasarDana, Hans Kwee, has responded to the impact of the Morgan Stanley Capital International (MSCI) index rebalancing announcement for May 2026, which has ejected several stocks from the Indonesian capital market. According to him, there are potential opportunities that can be exploited to gain profits from that momentum.
“The stock market is reacting to the MSCI rebalancing announcement on 12 May 2026. However, market participants should stay calm and not get caught in panic selling,” said Hans in his statement to reporters on Wednesday (13/5/2026).
He explained that it needs to be understood that the deletion of several issuers from the MSCI index is more of a technical nature related to weighting methodology and liquidity. It does not necessarily reflect fundamental damage to those companies.
In addition, many market participants and fund managers have anticipated the deletion of those stocks by MSCI in recent months. Passive fund managers will partly utilise the final period on 29 May to rebalance their portfolios in line with the MSCI announcement.
“Behind this short-term volatility, there is actually an opportunity to accumulate blue chip stocks and the small cap sector whose prices have corrected anomalously due to panic and forced selling pressure by passive fund managers,” he revealed.
Hans stated that transparency is now a crucial asset for Indonesia to follow in the footsteps of India’s success. In that regard, the role of the Financial Services Authority (OJK) and the Self Regulatory Organisation (SRO), namely the Indonesia Stock Exchange (BEI), Indonesian Central Securities Depository and Clearing (KPEI), and Indonesian Central Securities Depository (KSEI), is vital in tightening supervision of ownership structures and affiliated party transactions to ensure a fairer market.
“The SRO’s efforts in promoting more real-time information openness and OJK’s firm steps in reforming minority investor protection will serve as positive signals for global rating agencies like MSCI,” he said.
He cited India, which has successfully recovered and become a darling of emerging markets by aligning foreign ownership limits and strengthening the domestic investor base through massive investment digitalisation. Those steps prove that index adjustment periods are ‘cleansing’ moments to create a more credible market.
“For Indonesian investors, this is the time to conduct an objective portfolio evaluation, because markets that can improve after technical corrections often yield much more resilient growth in the long term. This MSCI announcement could be the bottom of the IHSG correction before it rebounds following company fundamentals,” he emphasised.
It was previously known that the global index provider, Morgan Stanley Capital International (MSCI), announced the results of the Indonesian market index review in the MSCI May 2026 Index Review.
In the MSCI index rebalancing announcement, six Indonesian stocks were officially removed from the MSCI Global Standard Index. The six stocks are PT Amman Mineral Internasional Tbk (AMMN), PT Barito Renewables Energy Tbk (BREN), PT Chandra Asri Pacific Tbk (TPIA), PT Dian Swastatika Sentosa Tbk (DSSA), PT Petrindo Jaya Kreasi Tbk (CUAN), and PT Sumber Alfaria Trijaya Tbk (AMRT).
MSCI also removed several stocks from the MSCI Global Small Cap Index. Those stocks are PT Aneka Tambang Tbk (ANTM), PT Astra Agro Lestari Tbk (AALI), PT Bank Aladin Syariah Tbk (BANK), PT Bumi Serpong Damai Tbk (BSDE), PT Dharma Satya Nusantara Tbk (DSNG), PT Industri Jamu dan Farmasi Sido Muncul Tbk (SIDO), PT Midi Utama Indonesia Tbk (MIDI), PT Mitra Keluarga Karyasehat Tbk (MIKA), PT MNC Digital Entertainment Tbk (MSIN), PT Pabrik Kertas Tjiwi Kimia Tbk (TKIM), PT Pacific Strategic Financial Tbk (APIC), PT Sawit Sumbermas Sarana Tbk (SSMS), and PT Triputra Agro Persada Tbk (TAPG).