Jakarta. Indonesian stocks ended a holiday-shortened trading week lower as foreign investors continued heavy selling, although gains in several conglomerate-linked stocks helped cushion the decline amid concerns over a weakening rupiah and MSCI index rebalancing.

The benchmark Jakarta Composite Index (JCI) slipped 0.56% over the week to close at 6,127.38, down from 6,162.05 a week earlier. The index briefly fell as much as 1% on Tuesday ahead of the Eid al-Adha holiday break. Trading resumed on Friday before another national holiday on June 1.

Despite the decline in the benchmark index, the Indonesia Stock Exchange’s market capitalization rose 0.88% to Rp 10,729 trillion ($601.95 billion) from Rp 10,635 trillion in the previous week.

Conglomerate-linked stocks emerged as key supports for the market amid persistent foreign selling. Shares of Barito Group companies led the gains, with Barito Renewables Energy (BREN) surging 27% during the week and Barito Pacific (BRPT) rising 10.5%. Chandra Daya Investasi (CDIA) advanced 5.6%, while Salim Group's consumer giant Indofood Sukses Makmur (INDF) gained 5%.

Average daily trading value jumped 30.37% to Rp 28.38 trillion from Rp 21.77 trillion, reflecting increased activity as investors adjusted portfolios ahead of MSCI’s latest index changes.

Foreign investors remained net sellers, recording Rp 8.52 trillion in net outflows during the week. Year-to-date foreign net sales reached Rp 53.97 trillion, underscoring persistent concerns over Indonesia’s financial markets.

Brokerage Pilarmas Investindo Sekuritas said Asian markets broadly strengthened toward the end of the week following reports that the United States and Iran had agreed in principle to extend a ceasefire for another 60 days, allowing further negotiations over Tehran’s nuclear program and reducing risks to shipping through the Strait of Hormuz.

However, domestic sentiment remained fragile as the rupiah weakened to Rp 17,881 per US dollar on Friday, its lowest level in the spot market, while investors also focused on MSCI-related portfolio adjustments.

Pilarmas said volatility linked to MSCI’s index implementation could continue to weigh on the JCI in the near term, making index-related developments a key concern for investors.

PasarDana co-founder and capital market practitioner Hans Kwee said passive fund managers were likely completing their final portfolio adjustments on May 29, although much of the repositioning had already occurred after MSCI announced its index review results on May 12.

“There has been no excessive panic despite pressure on stocks removed from the MSCI Global Standard Index and MSCI Small Cap Index,” Hans said. “The correction is largely technical, driven by MSCI’s weighting and liquidity methodology.”

He added that exclusion from MSCI indices does not necessarily reflect deteriorating corporate fundamentals.

Meanwhile, the government sought to reassure markets over energy security and fiscal stability. The Energy and Mineral Resources Ministry said national fuel supplies remain secure, with operational fuel reserves averaging between 20 and 23 days, meeting minimum requirements. The government also reiterated that it has no plans to raise subsidized fuel prices despite the rupiah’s depreciation.

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