IHSG foreign selling hits record as index sits 41% below peak

Key takeaways

• Indonesia's IHSG (Jakarta Composite Index) closed at 5,387.90 on October 22, 2026. That is about 41% below its record close of 9,134.70 on January 20, according to Kontan and the Indonesia Stock Exchange (IDX), as reported by Detik.
• Foreign investors net sold Rp1.49 trillion across all markets on October 22, even as the index rose 1.12%, Kontan and CNBC Indonesia reported.
• Over the five sessions from October 16 to 22, media-reported foreign net sales total roughly Rp8.8 trillion to Rp9.4 trillion. The total depends on which figure is used for October 21, when reports differ.
• The main cause cited by regulators, analysts and news agencies is MSCI's October proposal to move Indonesia from Emerging Market to Standalone status.
• The index has rebounded almost 8% from its October 19 low, but the rebound has been carried by domestic buyers, not foreign money.

IHSG foreign selling: the trend in numbers

IHSG foreign selling continued on October 22: foreign investors net sold Rp1.49 trillion even as the index rose 1.12% to close at 5,387.90, about 41% below its January 20 record of 9,134.70, according to Kontan.

The IDX regular session closes at 16:00 Western Indonesian Time (09:00 UTC). Foreign-flow figures are compiled by media from exchange data and can differ between "all markets" and "regular market" measures. Moving averages and the 20-session change are derived from Yahoo Finance data and have not been checked against IDX records.

Why it is happening

MSCI's standalone proposal

The selling sharpened after MSCI said it was considering moving Indonesia from Emerging Market to Standalone status, according to The Star and The Jakarta Post, citing Reuters. Standalone markets sit outside MSCI's main emerging market indexes, so passive funds tracking those benchmarks would have to sell. On October 16 the IHSG fell 11.57% to 5,185.10, its worst day since January 1998, after a 30-minute trading halt.

The Jakarta Post reported that MSCI first threatened a cut to frontier status in January over ownership and trading opacity. In October, MSCI said slow progress meant even a frontier downgrade would not reflect how serious the problems were. MSCI's consultation runs until April 30, 2027, with a decision due by June 30, 2027, CNBC Indonesia reported.

Estimated passive outflows

Goldman Sachs strategists estimate a full removal from MSCI indexes could trigger about $5.6 billion of passive outflows, according to The Jakarta Post (citing Reuters) and IDN Financials. "The burden of proof has shifted," the strategists wrote, as quoted by The Jakarta Post.

Panic and trust

Analysts quoted by The Jakarta Post said the rout was driven partly by panic selling, since the final decision is months away. Nafan Aji Gusta of Mirae Asset Sekuritas cited "trust issues" over transparency, liquidity and governance.

Rupiah and global risk

The rupiah closed at 18,060 per US dollar on October 22, Kontan reported. That is close to its record low of 18,190, set in June. A weaker currency reduces returns for dollar-based investors. On October 22, the S&P 500 fell 1.21% and the Nasdaq 2.60%, CNBC Indonesia and Suara reported.

Domestic support behind the rebound

The index has gained for three sessions mostly because of local buying. Danantara, the state investment agency, said it had begun buying shares, and several state-owned firms have buybacks, CNBC Indonesia reported. On October 21, Bank Indonesia held its BI-Rate at 5.75% and cut bank reserve requirements, according to Antara and Kontan. Regulators also acted: the IDX lowered its lower auto-rejection limit to 7% from 15%, and the Financial Services Authority (OJK) announced fines totalling Rp2.1 trillion over alleged trading manipulation, The Jakarta Post and The Star reported.

Key levels being watched

• 5,250–5,300 and 5,400–5,450: BNI Sekuritas named these as support and resistance ranges for October 23, Suara reported.
• 5,185: the October 16 close, also the intraday low on October 21 and October 22, according to Kontan and InvestorTrust.
• About 5,000: the index closed below this level on October 19, the lowest close of 2026, Kontan reported.
• 6,235 and 6,965: the 50-day and 200-day moving averages (Bullquill calculation from Yahoo Finance data). The index is far below both, which is typical of a downtrend.

What we know and what we don't know yet

What we know

• Foreign investors net sold on at least four of the last five sessions, including the October 22 rally.
• 2026 foreign net sales are the largest on record, according to IDX data cited by The Jakarta Post.
• MSCI has not made a final decision. Indonesia still has Emerging Market status.

What we don't know yet

• The exact foreign flow for October 21. Media reports differ, and the IDX website could not be reached for this article.
• How much stock Danantara has bought. The agency has not given a total.
• When the rule removing high-concentration stocks from the IHSG takes effect. CNBC Indonesia reported November 2, 2026, but we could not confirm this with an IDX statement.
• Whether the foreign selling is driven by passive funds preparing for an exit or by active managers cutting risk. The cause of each day's flow has not been confirmed.

What it means

Analysis. The IHSG rose almost 8% in three days, but foreign investors kept selling throughout. When local buyers are lifting the index while foreigners sell, the rally is narrow and can reverse. MSCI's process gives Indonesia until mid-2027 to show progress on transparency, so the overhang is likely to last for months, not days. Signs that foreign selling is easing would be daily IDX data turning to steady net buying and a stable rupiah. For background, read our explainer on MSCI and Indonesian capital flows, our report on Bank Indonesia's October decision, and the October 22 and October 21 Indonesia daily briefs. Track Asian and global markets on our markets dashboard.

Sources

• Kontan: Foreigners net sell Rp1.49 trillion as IHSG rises (in Indonesian)
• Kontan: IHSG up 1.12% at 5,387 (in Indonesian)
• CNBC Indonesia: IHSG closes in the green, foreign flows (in Indonesian)
• Katadata Databoks: BBCA most sold by foreigners, October 22, 2026 (in Indonesian)
• InvestorTrust: Foreign net sales still above Rp92 trillion (in Indonesian)
• Kontan: IHSG jumps 5.65%, foreigners net sell Rp2.21 trillion (in Indonesian)
• Kontan: Foreigners net sell as IHSG rises 0.93% (in Indonesian)
• Kontan: Rp3.35 trillion foreign net sales on October 16 (in Indonesian)
• KabarBursa: IHSG up 5.65%, foreigners net sell Rp2.21 trillion (in Indonesian)
• The Star / The Jakarta Post: "Panic" blamed for Indonesia's record stock market outflows
• The Star: Indonesia stocks sink most since 1998 after MSCI flags standalone downgrade
• The Jakarta Post: Indonesian stocks slide to six-year low as MSCI standalone warning weighs
• IDN Financials: Goldman Sachs says MSCI threat could trigger $5.6 billion in outflows
• Suara: IHSG technicals, resistance at 5,450 (in Indonesian)
• Detik: IHSG sets a record, then corrects (in Indonesian)
• Antara: BI rate holds at 5.75%
• Kontan: Rupiah closes at 18,060 per dollar (in Indonesian)
• CNBC Indonesia: State-owned stocks bought, Danantara starts buying (in Indonesian)

This article is for information only and is not investment advice.