TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
IDX Composite dips below 7,000 after BREN’s FTSE exclusion
BREN’s exclusion from the FTSE index prompted a sharp IDX Composite fall, closing at 6,947.67 on Wednesday. The move sparked a broad sell-off in today’s session.
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
A woman walks past a large screen displaying stock indices at the Indonesia Stock Exchange (IDX) in Jakarta on March 14, 2024. BREN’s exclusion from the FTSE index prompted a sharp IDX Composite fall, closing at 6,947.67 on June 5, 2024. (AFP/Bay Ismoyo)
T
he Indonesia Stock Exchange (IDX) Composite index took a downturn on Wednesday, retreating from the 7,000-mark despite a promising start. The index opened up at 7,099 and peaked at 7,118.35, only to reverse course and plunge by 2.14 percent, 151.64 points, ending the day at 6,947.67.
The descent was widespread, with 10 sectoral indices falling. The healthcare sector stood as the sole beacon of strength, edging up by 0.79 percent. In stark contrast, the basic materials sector took a steep dive, dropping 6.29 percent, while the infrastructure sector declined by 2.02 percent.
Leading the day's gainers, PT Mitra Adiperkasa (MAPI) saw its shares up by 3.45 percent, with PT Ace Hardware Indonesia (ACES) and PT Telkom Indonesia (TLKM) also on the rise, gaining 2.41 percent and 2 percent, respectively.
On the losing side, PT Merdeka Battery Materials (MBMA) experienced the biggest drop, with its share price falling 12.12 percent. PT ESSA Industries Indonesia (ESSA) and PT Merdeka Copper Gold (MDKA) followed, with their shares tumbling by 10.62 percent and 8.68 percent, respectively.
Trading activity was robust, with a total volume of 18.7 billion shares and a transaction value of Rp 11.8 trillion (US$723.60 million). The market saw 421 stocks declining in price, while only 172 advanced and 192 remained unchanged.
The index's decline was heavily influenced by a significant drop in the share price of Prajogo Pangestu's PT Barito Renewables Energy (BREN), which fell by 10 percent to Rp 7,425 per share. This steep drop led to the shares hitting the lower auto-rejection limit.
The downturn in BREN’s shares came on the heels of the company's exclusion from the Financial Times Stock Exchange (FTSE) Global Equity Index by the FTSE Russell.
Along with its placement on a special monitoring board subject to the full call action (FCA) trading mechanism, these factors are believed to have triggered significant investor selling.
The FCA decision drew criticism from investors.
Former Jakarta Stock Exchange chief executive officer Hasan Zein Mahmud criticized the FCA policy, advocating for a return to the more transparent continuous auction system.
"The solution is simple: return to the transparent continuous auction, if necessary, without price limits. Meanwhile, market integrity should be improved," Hasan said on Wednesday, as quoted by cnbcindonesia.com.
Responding to the issue, IDX corporate valuation director I Gede Nyoman Yetna maintained that the IDX is always open to feedback and continuously reviews policies as needed.
"As a form of transparency for investors, we provide price indicators and volume indicators that can serve as references for making investment decisions," Nyoman said on Tuesday, as reported by investor.id.
“Information related to listed companies is available on our website and accessible to investors at all times.”
