The total market capitalisation of Indonesian-listed companies has fallen from a peak in January to US$618 billion, while Singapore’s has climbed to US$645 billion, according to data compiled by Bloomberg.

Investor sentiment in Indonesia has increasingly soured in recent months amid uncertainties over a potential equities reclassification to frontier markets, as well as Fitch Ratings Inc. and Moody’s Ratings both cutting their credit rating outlooks to negative. Its stock benchmark sits at the bottom among global peers while the rupiah has touched a succession of record lows.

The momentum may not be in Indonesia’s favour at the moment, said Soh Chih Kai, a portfolio manager at Lion Global Investors Ltd. Still, a revival in the future should not be ruled out, he said.

“Nevertheless, this reinforces the relative standing of the Singapore market as capital flows continue to reward certainty amidst global policy uncertainty,” Soh said.

Singapore equities have benefited from economic and political stability, as well as government-led market reforms. The Straits Times Index climbed to a record this week as investors sought defensive havens during volatility sparked by the Iran war.

The island nation’s stocks are on pace to outperform their Indonesian peers by the most on record in 2026.