{"id":74327,"date":"2026-11-08T01:08:11","date_gmt":"2026-11-08T05:08:11","guid":{"rendered":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/msci-downgrade-warning-over-indonesia-went-too-far-presidential-adviser-says\/74327\/"},"modified":"2026-11-08T01:08:11","modified_gmt":"2026-11-08T05:08:11","slug":"msci-downgrade-warning-over-indonesia-went-too-far-presidential-adviser-says","status":"publish","type":"post","link":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/msci-downgrade-warning-over-indonesia-went-too-far-presidential-adviser-says\/74327\/","title":{"rendered":"MSCI Downgrade Warning Over Indonesia &#8216;Went Too Far,&#8217; Presidential Adviser Says"},"content":{"rendered":"<h2>Key Takeaways<\/h2>\n<ul>\n<li><strong>MSCI (<a href=\"\/stock\/MSCI\">MSCI<\/a>)<\/strong> has launched a consultation to potentially downgrade <strong>Indonesia<\/strong> from &quot;Emerging Market&quot; to &quot;Standalone Market&quot; status, a move that could trigger over <strong>$5 billion<\/strong> in capital outflows.<\/li>\n<li><strong>Hashim Djojohadikusumo<\/strong>, a top adviser and brother to President <strong>Prabowo Subianto<\/strong>, criticized the warning as &quot;unfair&quot; and &quot;excessive,&quot; though he acknowledged the need for better market transparency.<\/li>\n<li>The <strong>Jakarta Composite Index<\/strong> has plunged approximately <strong>40%<\/strong> in 2026, making it the world&#39;s worst-performing major equity market amid concerns over stock manipulation and government policy.<\/li>\n<li>Authorities in <strong>Israel<\/strong> confirmed that reports of a hostile aircraft infiltration in the northern Galilee region on Sunday were a <strong>false alarm<\/strong> caused by a &quot;false identification.&quot;<\/li>\n<li>A violent armed attack in <strong>Guatemala&#39;s<\/strong> Zacapa department resulted in the death of Congressman <strong>Julio Cesar Portillo Paz<\/strong> and three police officers.<\/li>\n<\/ul>\n<h2>Indonesia Rejects MSCI Downgrade Threat<\/h2>\n<p>A senior adviser to Indonesian President <strong>Prabowo Subianto<\/strong> has pushed back against <strong>MSCI Inc. (<a href=\"\/stock\/MSCI\">MSCI<\/a>)<\/strong> after the index provider warned it might reclassify the country as a &quot;standalone market.&quot; <strong>Hashim Djojohadikusumo<\/strong> told the <em>Financial Times<\/em> that while the government recognizes the need for &quot;best practices&quot; and transparency, relegating Southeast Asia\u2019s largest economy to a category alongside nations like Zimbabwe and Nigeria &quot;went too far.&quot;<\/p>\n<p>The potential downgrade follows <strong>MSCI&#39;s (<a href=\"\/stock\/MSCI\">MSCI<\/a>)<\/strong> concerns regarding &quot;suspected coordinated trading&quot; and a lack of regulatory enforcement in the Indonesian capital markets. A reclassification to standalone status\u2014bypassing the &quot;Frontier Market&quot; tier\u2014would force passive funds to liquidate billions in Indonesian equities. <strong>Goldman Sachs (<a href=\"\/stock\/GS\">GS<\/a>)<\/strong> estimates the resulting outflows could exceed <strong>$5 billion<\/strong>, further pressuring the <strong>rupiah<\/strong>, which has already depreciated significantly this year.<\/p>\n<p>In response to the crisis, Investment Minister <strong>Rosan Roeslani<\/strong> stated that the government is accelerating reforms, including tighter rules on free-float shares and enhanced disclosure for holdings above 1%. The <strong>Jakarta Composite Index<\/strong> recently suffered its worst single-day rout in nearly three decades, falling over <strong>11%<\/strong> in a single session following the initial <strong>MSCI (<a href=\"\/stock\/MSCI\">MSCI<\/a>)<\/strong> announcement. A final decision on the classification is expected by <strong>June 2027<\/strong>.<\/p>\n<h2>Security Alerts and Political Violence<\/h2>\n<p>In the Middle East, the <strong>Israeli military<\/strong> clarified that sirens sounded in northern border communities early Sunday were the result of a <strong>false identification<\/strong>. Residents in <strong>Zar&#39;it<\/strong> and <strong>Shomera<\/strong> had been alerted to a suspected hostile aircraft infiltration from <strong>Lebanon<\/strong>, but the <strong>IDF<\/strong> confirmed shortly after that no actual breach had occurred. The incident highlights the continued high state of alert along the frontier as regional tensions persist.<\/p>\n<p>Separately, in <strong>Guatemala<\/strong>, an armed ambush in the eastern department of <strong>Zacapa<\/strong> claimed the lives of opposition lawmaker <strong>Julio Cesar Portillo Paz<\/strong> and three National Civil Police officers. The attack occurred in a region known for drug trafficking activity controlled by local cartels. President <strong>Bernardo Arevalo<\/strong> condemned the violence, which comes amid a rise in targeted political assassinations ahead of next year&#39;s elections.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Key Takeaways MSCI (MSCI) has launched a consultation to potentially downgrade Indonesia from &quot;Emerging Market&quot; to &quot;Standalone Market&quot; status, a [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":50383,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center 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