Jakarta. Indonesia Stock Exchange (IDX) lowered its asymmetric lower auto rejection limit to 7% from 15% on Monday in a bid to contain a market sell-off triggered by concerns over MSCI’s assessment of Indonesia’s stock market, although analysts warned that selling pressure could persist.

The revised limit is intended to curb sharp stock price declines by restricting daily losses, giving investors more time to digest market developments and potentially preventing excessive volatility.

However, the measure has yet to ease the pressure on Indonesian equities. The Jakarta Composite Index (JCI) fell 263 points, or 5.07%, to 4,922 at the time of writing, while several stocks, including Dian Swastatika Sentosa (DSSA), Semen Indonesia (SMGR) and Vale Indonesia (INCO), hit their lower price limits.

M Nafan Aji Gusta, senior technical analyst at Mirae Asset Sekuritas, described the adjustment as a tactical response to the sharp sell-off following MSCI-related concerns.

“The MSCI-related developments triggered widespread panic selling in the market,” Nafan said on Monday.

The lower limit, implemented by the IDX and the Financial Services Authority (OJK), could help contain sudden market declines by preventing individual stocks from falling more than 7% in a single trading session, he said.

However, Nafan warned that sustained selling pressure could force stocks to hit the lower limit over consecutive sessions, prolonging the search for equilibrium prices and temporarily restricting market liquidity.

Herditya Wicaksana, head of retail research at MNC Sekuritas, also said the policy was intended to contain stock price declines following the MSCI-related concerns but cautioned that the market could remain under pressure.

“Selling pressure on the stock market is likely to persist for some time,” Herditya said.

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