Jakarta. Indonesia’s stock exchange has extended a suspension on short selling as global geopolitical tensions and persistent economic pressures fuel heightened market volatility.

The Indonesia Stock Exchange (IDX) said it would prolong the delay of short-selling transactions beyond the previously set deadline of March 17, 2026, citing fragile market conditions and sensitivity to external shocks.

Acting President Director Jeffrey Hendrik said the move is aimed at mitigating downside risks and preventing excessive selling pressure in the equity market.

“Our market remains heavily influenced by global uncertainty. We believe it is necessary to extend the postponement of short selling,” Jeffrey told reporters at the exchange’s headquarters in Jakarta on Friday.

The decision comes as financial markets grapple with renewed tensions in the Middle East, fluctuating oil prices, and ongoing pressure on emerging market currencies — factors that have amplified volatility across regional bourses.

In addition to the short-selling delay, the bourse will maintain a series of extraordinary measures designed to stabilize trading and boost investor confidence.

These include relaxed share buyback rules that allow listed companies to repurchase stocks without prior shareholder approval, giving issuers more flexibility to support their share prices during periods of stress.

The exchange is also continuing its asymmetric auto-rejection policy, which limits the extent of price declines within a single trading day, as well as circuit breaker mechanisms that temporarily halt trading when the benchmark index drops beyond certain thresholds.

“We will continue these policies given the current abnormal market conditions,” Jeffrey said.

Short selling — where investors sell borrowed shares in anticipation of buying them back at lower prices — has been under preparation with oversight from the Financial Services Authority. Several brokerage firms, including Ajaib Sekuritas Asia and Semesta Indovest Sekuritas, have already secured technical approvals to facilitate such transactions.

However, the exchange views the current macroeconomic backdrop as too risky to introduce an instrument that could exacerbate market swings. Authorities are closely monitoring a range of variables, including geopolitical uncertainty, oil price movements, and capital flows affecting emerging economies.

Earlier this month, the Jakarta Composite Index (JCI) was still hovering around the 8,000 level, but rising oil prices driven by Middle East tensions have sent the index and regional bourses reeling.

The JCI extended its losses at the end of the week, closing sharply lower on Friday as global geopolitical tensions and persistent foreign outflows weighed on sentiment. The benchmark index fell 0.94%, or 67 points, to 7,097, after trading within a range of 7,070 to 7,154.

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