Listen to this articleThe influential index provider MSCI has warned of “investability risk” on the Indonesia Stock Exchange. (Photo: Reuters)JAKARTA - Indonesian stocks slumped 7% on Wednesday after the index provider MSCI flagged investability risk, citing a lack of transparency in ownership structure and free-float data, and raising the possibility of a downgrade to “frontier market” status. MSCI said it would reassess the accessibility for global investors of the Indonesian market should there be no meaningful improvement in transparency by May. Reassessment could lead to a lower weighting for Indonesian stocks in MSCI’s influential emerging-market indices or even a downgrade to frontier-market status. Indonesia Stock Exchange (IDX), the Securities Depository and Settlement Institution (KSEI) and the financial regulator OJK were discussing the matter with MSCI, bourse officials told reporters.
