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.
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search results
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search resultsMSCI still has gripes with Indonesian stock market transparency
Global index provider MSCI has downgraded Indonesia’s information flow criterion to negative in its latest review, raising concerns over the “investability” of the country’s stock market due to limited transparency in shareholding structures and signs of coordinated trading behavior.
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 takes a photo of an electronic display showing negative movements across the Indonesia Stock Exchange (IDX) Composite index on Feb. 2 at the bourse’s South Jakarta headquarters. (Antara/Sulthony Hasanuddin)
G
lobal index provider MSCI has downgraded Indonesia’s information flow criterion to negative in its latest review, raising concerns over the “investability” of the country’s stock market.
In its Global Market Accessibility Review published on Thursday afternoon, MSCI said the ongoing opacity in shareholding structures and indications of coordinated trading undermined proper price formation.
“These issues materially limit international institutional investors' ability to assess true free float and to rely on observed market prices for portfolio construction and index replication,” reads the review.
MSCI also highlighted concerns over equal access to information for foreign investors, noting that company information was not always readily available in English.
Indonesia also has “no efficient offshore currency market” and there are constraints on the onshore market.
These concerns come ahead of an announcement on June 23, when MSCI is set to wrap up its assessment and determine whether it will continue to categorize Indonesia as an emerging market.
A downgrade in the country’s status by the index compiler could potentially cost Indonesia as much as US$13 billion in capital outflows, investment bank Goldman Sachs has estimated.
