JAKARTA – Indonesian equities have experienced a significant influx of foreign capital over the past month, fueled by rebalancing activities within the Morgan Stanley Capital International (MSCI) and FTSE Global Equity Series indexes.
Data from the Indonesia Stock Exchange (IDX) reveals a foreign net buy of Rp2.37 trillion in today’s trading session, Tuesday, August 26, 2026. Over the last month, the Indonesian stock market has seen a substantial inflow of foreign funds, reaching a net buy of Rp10.3 trillion.
However, despite this recent surge, the Indonesian stock market still reflects a year-to-date (YTD) foreign net sell of Rp49.33 trillion since the beginning of trading in 2025.
This recent influx of foreign capital coincides with the momentum of global index rebalancing by MSCI and FTSE.
FTSE Russell recently announced changes to the constituents of its FTSE Global Equity Series. According to FTSE Russell data, shares of PT Dian Swastatika Sentosa Tbk. (DSSA) have been added to the large-cap category of the FTSE Global Equity Index Series for Asia Pacific ex Japan ex China.
In the mid-cap category, PT Bank Danamon Indonesia Tbk. (BDMN) was removed from the FTSE Global Equity Index Series. No Indonesian stocks were added to or removed from the FTSE Global Equity Index Series small-cap category.
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Eight Indonesian issuers have been included in the FTSE Global Equity Index Series micro-cap category. These are PT Kencana Energi Lestari Tbk. (KEEN), PT Midi Utama Indonesia Tbk. (MIDI), PT MNC Kapital Indonesia Tbk. (BCAP), PT Multi Bintang Indonesia Tbk. (MLBI), PT Nusantara Sejahtera Raya Tbk. (CNMA), PT Sariguna Primatirta Tbk. (CLEO), and PT Ultrajaya Milk Industry & Trading Tbk. (ULTJ).
These eight stocks replace those removed from the FTSE micro-cap index, namely PT Bekasi Fajar Industrial Estate Tbk. (BEST), PT Dana Brata Luhur Tbk. (TEBE), PT IMC Pelita Logistik Tbk. (PSSI), PT Murni Sadar Tbk. (MTMH), PT Resource Alam Indonesia Tbk. (KKGI), PT Semen Baturaja Tbk. (SMBR), and PT Uni-Charm Indonesia Tbk. (UCID).
Read More: BCAP to CLEO Enter FTSE Micro Cap, Peek at the Stock Movements of the New Inhabitants
These rebalancing results took effect on September 19th and became effective on September 22, 2025. Changes to the index constituents could still be revised by FTSE until the close of trading on September 5, 2025.
Earlier this month, MSCI also conducted a rebalancing of its indices, effective tomorrow, August 27, 2025.
In its latest review, DSSA and PT Petrindo Jaya Kreasi Tbk. (CUAN) were officially added to the MSCI Global Standard Index, replacing PT Alamtri Resources Indonesia Tbk. (ADRO), which moved to the MSCI Small Cap Index.
In addition to ADRO, the stocks entering the MSCI Small Cap Index include PT Adaro Andalan Indonesia Tbk. (AADI), PT MNC Tourism Indonesia Tbk. (KPIG), Petrosea (PTRO), PT Raharja Energi Cepu Tbk. (RATU), and PT Triputra Agro Persada Tbk. (TAPG).
Meanwhile, PT Merdeka Battery Materials Tbk. (MBMA) and PT Panin Financial Tbk. (PNLF) were removed from the MSCI Small Cap Index.
Senior Market Chartist at Mirae Asset Sekuritas, Nafan Aji Gusta, stated that global fund managers would consider the Indonesian stock market in light of the index rebalancing.
“Theoretically, stocks included in the MSCI and FTSE indices become significant considerations for global fund managers to accumulate these issuers,” he told Bisnis on Tuesday, August 26, 2025.
He believes that during the rebalancing period, all issuers included, whether small, medium, or large cap, reflect good company performance.
“So it’s only natural that foreign funds are flowing in, especially with such a strong inflow of foreign funds this month,” Nafan added.
Indonesian capital market observer Reydi Octa also views the latest MSCI and FTSE rebalancing as a positive catalyst for foreign capital flows.
“The inclusion of DSSA and CUAN in the MSCI Global Standard Index, and DSSA also in the FTSE Large Cap, strengthens foreign investors’ confidence in stocks with large capitalization, liquidity, and strong prospects. This has the potential to trigger global funds from assets under management that refer to the index or passive funds,” Reydi told Bisnis on Tuesday, August 26, 2025.
Looking ahead, stocks entering the FTSE and MSCI indices, such as DSSA, CUAN, CLEO, ULTJ, PTRO, and RATU, have the potential to become targets for foreign investment due to increased exposure from the indices.
Head of Research at Kiwoom Sekuritas, Liza Camelia Suryanata, noted that the rebalancing sentiment does trigger foreign fund flows and increases market visibility. However, global fund managers will also consider stock prices, such as DSSA and CUAN, which have already risen sharply in the past month or three months. As a result, she believes that foreign investors are not reckless in accumulating shares.
“In addition to rebalancing, factors such as rerating from institutions and domestic sentiment also contribute to foreign inflows,” Liza concluded.
Summary
Indonesian equities have witnessed a substantial increase in foreign capital over the past month, driven by rebalancing activities within the MSCI and FTSE Global Equity Series indexes. The Indonesia Stock Exchange (IDX) reported a foreign net buy of Rp2.37 trillion in a recent trading session, contributing to a total net buy of Rp10.3 trillion over the last month. Despite this recent surge, the year-to-date foreign net sell remains at Rp49.33 trillion.
The rebalancing by FTSE Russell and MSCI has led to additions and removals of several Indonesian stocks within their respective indices. Experts suggest that stocks included in these indices gain increased visibility and become attractive targets for global fund managers. However, it’s important to note that global fund managers also consider stock prices and overall market sentiment before making investment decisions.