Indonesia’s financial regulator has decided to postpone the introduction of short-selling in response to heightened market volatility. The move, initially planned for Q2 2025, may now be pushed to later this year, depending on market conditions.
Key Reasons Behind the Delay
- Market Volatility: Indonesia’s equities recently fell into a bear market before rebounding sharply.
- Regulatory Caution: The Indonesia Financial Services Authority (OJK) met with brokers and fund managers before deciding to defer the move.
- Share Buyback Flexibility: Regulators are also considering allowing corporate share buybacks without a shareholder meeting to stabilize stock prices.
Market Context: Recent Selloff & Recovery
- Jakarta Composite Index (JCI)entered a bear market last week, driven by:
- Global trade tensions
- Flat economic growth
- Concerns over government spending
- Sharp Rebound: The JCI surged 4% on Monday, its biggest gain in nearly five years, as banking stocks rallied following JPMorgan’s upgrade of Indonesian lenders.
Short-Selling Plan & Future Outlook
- The IDX stock exchange planned to allow retail investors to short-sell 10 stocks, aiming to provide more trading options in bearish markets.
- Future Implementation: Short-selling could still be introduced later in 2025 if market stability improves.
📌 Stay tuned for updates on Indonesia’s financial market developments!