The Indonesian Composite Stock Price Index (IHSG) returned to negative territory throughout trading on Monday (May 18, 2026). The decline was still attributed to the MSCI rebalancing announcement and FTSE Russell’s plan to remove stocks categorized under High Shareholding Concentration (HSC), which was announced on Wednesday (May 13).

However, the announcements from the two global index providers were not the sole driving factors behind the market weakness. The IHSG’s movement also mirrored the downturn seen across several major Asian stock markets.

According to RTI Business data, the IHSG dropped 1.85% to 6,599.24. The Indonesian benchmark moved lower alongside regional markets, including Japan’s Nikkei 225 Index (N225), which fell 0.97% to 60,815.89.

Meanwhile, Chinese stock markets also weakened, with the Hang Seng Index (HSI) declining 1.11% to 25,675.17 and the Shanghai Composite Index (SSEC) slipping 0.09% to 4,131.52. In contrast, Singapore’s Straits Times Index (STI) managed to rise 0.15% to 4,996.75.

“The IHSG today was not only pressured by MSCI and FTSE developments, but also by weakness across global and Asian regional markets,” said Herditya Wicaksana, Head of Retail Research at MNC Sekuritas, to detikcom on Monday (May 18, 2026).

On the other hand, geopolitical tensions between the United States and Iran also weighed on the IHSG after driving global crude oil prices higher. Herditya noted that oil prices had now climbed above US$100 per barrel.

From the domestic side, the IHSG was additionally pressured by the rupiah’s depreciation against the US dollar, which touched Rp17,676 per US dollar. The accumulation of these negative sentiments once again raised concerns among investors in Indonesia’s capital market.

“This situation has once again heightened concerns about future inflationary pressures and the risk of a global economic slowdown,” he said.

Accumulated Pressure on the IHSG

Acting President Director of the Indonesia Stock Exchange (BEI), Jeffrey Hendrik, explained that Asian stock markets had experienced sharp corrections over the previous two trading days. The pressure from Asian markets was then reflected in the IHSG’s decline today.

“If we observe closely, uncertainty in our market remains quite high. Moreover, while our market was closed on Thursday and Friday, global markets—especially those in Asia—also experienced corrections,” Jeffrey stated at the BEI building in South Jakarta on Monday (May 18, 2026).

Jeffrey added that besides the weakness in Asian markets, the IHSG was also being affected by broader global sentiment. Nevertheless, he emphasized that the IHSG’s correction remained in line with movements across Asian stock exchanges.

He also urged investors not to panic in responding to ongoing global market dynamics. According to Jeffrey, investors should carefully assess company fundamentals and conduct thorough analysis before making investment decisions.

“With the additional correction in global markets today, our market movement is still aligned with global trends. However, uncertainty in the domestic market remains relatively high,” he explained.

Investors Rebalancing Their Portfolios

Capital market observer Reydi Octa said investors are currently readjusting their portfolios in the Indonesian capital market. The move also followed the MSCI and FTSE Russell announcements made last week.

“The market sees this policy as potentially triggering further portfolio adjustments by both foreign investors and passive funds, particularly in stocks with limited free float and less-than-ideal liquidity,” Reydi told detikcom.

He explained that investors would not rush into making new investment decisions in Indonesia’s capital market. According to him, the portfolio adjustment process is likely to continue over the coming weeks.

“Generally, the rebalancing process is carried out gradually over several days to several weeks, depending on risk profiles, investment objectives, and market liquidity conditions,” he concluded.