(Aug 19): FTSE Russell will defer certain index changes for Indonesian equities until at least its December review, giving it more time to assess the effectiveness of market reforms by local authorities.

The global index provider is essentially holding off on revisions that would increase the weight of Indonesian shares in its gauges, while still allowing some changes in its September review that reduce or remove stocks, according to its statement dated Aug 18. 

FTSE won’t add newly eligible Indonesian companies, including initial public offerings, for now. It will also hold off on moving stocks into different size categories and increasing their index weight when more of their shares become available for public trading.

However, it will proceed with some changes that reduce a stock’s weight in its indices, including demotions to micro-cap and decreases in free float during the September review. It will also remove those with highly concentrated shareholdings. The deletions will take effect at the market open on Sept 21.

The decision follows MSCI Inc’s move in June to delay its review of Indonesia’s market status until November as it needed more time to gauge if reforms are effective. The MSCI has removed companies with highly concentrated shareholdings after regulators started flagging such stocks as part of measures aimed at averting a potential market-status downgrade.

The benchmark stock index fell as much as 1.2% in early trading Wednesday, along with regional peers, after closing in bull-market territory the previous session. 

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