Jakarta. Jakarta Composite Index (JCI) ended nearly flat on Friday, slipping 0.05% despite pressure from MSCI index rebalancing, continued foreign selling, and rupiah depreciation.

The benchmark index fell 3 points to 6,127 after trading between 6,111 and 6,230. Market turnover reached Rp 48.5 trillion ($2.7 billion) from 46.1 billion shares traded across more than 2.3 million transactions. Declining stocks outnumbered gainers, with 409 shares falling, 271 advancing, and 137 unchanged.

Several brokerages, including CGS International Sekuritas Indonesia, BRI Danareksa Sekuritas, and Phintraco Sekuritas, had projected a weaker and more volatile session, citing pressure from the rupiah's continued depreciation, foreign outflows, and the implementation of MSCI's latest index rebalancing.

However, the market proved more resilient than expected, supported by gains in several conglomerate-linked stocks and improving global risk sentiment.

Pilarmas Investindo Sekuritas said that asian markets broadly strengthened ahead of the weekend after reports suggested the United States and Iran had agreed in principle to extend their ceasefire for another 60 days, although US President Donald Trump had not formally approved the arrangement.

The potential extension would allow both countries to continue negotiations over Tehran's nuclear program while considering unrestricted shipping through the Strait of Hormuz.

"This development eases concerns over potential supply disruptions in the Middle East and improves global risk sentiment as geopolitical tensions begin to subside," Pilarmas wrote in a research note.

Despite the positive external backdrop, investors remained cautious over domestic factors, particularly the rupiah's weakness against the US dollar and portfolio adjustments related to MSCI's rebalancing.

Pilarmas said the volatility surrounding MSCI's implementation could continue to weigh on the JCI in the near term, making those developments a key focus for investors going forward.

Separately, PasarDana co-founder and capital market practitioner Hans Kwee said passive fund managers were likely carrying out their final portfolio adjustments on May 29. However, he noted that much of the repositioning had likely occurred since 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. The correction is largely technical, driven by MSCI's weighting and liquidity methodology," Hans said.

He emphasized that exclusion from MSCI indices does not indicate weakening corporate fundamentals.

"Many of the companies removed from the index continue to post strong performance, maintain solid prospects, and now offer increasingly attractive valuations," he said.

Hans said the recent decline in affected stocks could present accumulation opportunities for long-term investors seeking value amid technical market pressure.

He also believes the MSCI rebalancing period could mark a bottoming phase for the JCI before investors return their focus to corporate earnings and business fundamentals.

"After the rebalancing is completed, the JCI has a strong chance of recovering. Many fundamentally strong stocks have fallen too deeply because of technical pressure rather than deteriorating performance," Hans added.

On regional market, Japan's Nikkei 225 jumped 2.5% to a record close of 66,329.50 after Tokyo's core inflation data for May rose more slowly than expected. South Korea's Kospi surged 3.6% to an all-time high of 8,476, led by technology stocks benefiting from the global artificial intelligence boom.

Hong Kong's Hang Seng Index gained 0.9% to 25,222, while China's Shanghai SSE fell 0.9% to 4,063.

On Wall Street overnight, the S&P 500 climbed 0.6% to a fresh record high of 7,563. The Dow Jones Industrial Average edged up less than 0.1% to 50,668, while the Nasdaq Composite advanced 0.9% to 26,917.

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