Indonesia Stock Exchange cuts lower limit for more stocks to cool volatility

By Reuters News

JAKARTA, Oct 20 (Reuters) - The Indonesia Stock Exchange .JKSE on Tuesday cut the lower auto-rejection limit to 1 rupiah from 7% for stocks in the 11 rupiah-to-14 rupiah price range, aiming to tame a selloff after MSCI threatened to remove Indonesia from its global indexes.

  • The adjustment is to help ensure trading is orderly, fair and efficient and supports better price discovery, the exchange said.

  • The new policy is effective Tuesday until December 31 this year

  • For stocks at 15 rupiah and above, the down limit remains at 7%

  • A down limit of 1 rupiah for stocks priced below 10 rupiah apiece still applies

  • Sell orders below limit-down prices are automatically rejected by the bourse's trading system

  • The move is the latest aimed at easing a stock market rout due to index provider MSCI's proposal to downgrade Indonesia to "standalone" status, which would exclude it from MSCI's global emerging and frontier market indexes

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