Indonesian stocks bounce off six-year low

BENGALURU: Indonesia’s stock market rose on Tuesday, off a six-year closing low hit after index compiler MSCI warned of a classification downgrade last week, while the Taiwan dollar drifted around its lowest point in 18 months.

The Jakarta Composite Index rose 3.1 percent as investors focused on Indonesia’s new measures to curb the selloff. MSCI warned of a downgrade to “standalone” status from “emerging market”, which could trigger a selloff by passive funds that track global indexes.

The rebound was a bright spot against a broader market gloom, with MSCI’s gauge of emerging Asia equities down 1.4 percent, weighed by a 3.7 percent decline in heavyweight South Korean equities.

In Taipei, shares shed 1.1 percent with a 0.6 percent drop in TSMC. Taiwan dollar weakened to 32.651 per dollar. The currency has lost almost 2 percent in the last four sessions.

Indonesia’s stock exchange on Monday excluded stocks with highly concentrated shareholding from its benchmark index and halved the daily down limit on stock prices after equities fell nearly 15 percent over the previous two sessions following MSCI’s warning.

The rupiah appreciated marginally to 17,980 a dollar, snapping a four-day losing streak. Bank Indonesia is narrowly expected to hold interest rates on Wednesday despite market selloff, according to a Reuters poll.