Indonesian Stocks Swing After Higher Open as Fed,Geopolitical Risks\nLoom<\/p>\n
Jakarta. Indonesian stocks opened higher on Monday but quickly turned\nvolatile as investors weighed US monetary policy, geopolitical tensions\nand potential disruptions to global trade and supply chains.<\/p>\n
Jakarta Composite Index (JCI) rose 15 points, or 0.24%, to 6,652 at\nthe open before moving between 6,620 and 6,662 in early trading.<\/p>\n
Data from RTI showed 1.45 billion shares had changed hands in the\nopening minutes, with total transactions reaching Rp 637.51 billion\n($36.11 million) across 108,137 trades. A total of 246 stocks advanced,\n204 declined and 250 were unchanged.<\/p>\n
Pluang Research said two closely linked catalysts will shape the US\nbond market this week. On Wednesday, the US Treasury is set to announce\ndetails of its buyback program, which could be increased threefold to\nfivefold from the previous $2 billion. Historically, a buyback above $4\nbillion has been enough to trigger a bond rally.<\/p>\n
Two days later, the release of August consumer price index (CPI) data\nwill help determine whether the Federal Reserve will raise interest\nrates at its Sept.\u00a016 meeting. The swaps market currently puts the\nprobability at 60%.<\/p>\n
\u201cThe combination of these two events creates a classic tension\nbetween monetary policy, which tends to push up short-term yields, and\nfiscal policy, which seeks to contain long-term borrowing costs,\u201d Pluang\nResearch said in a report on Monday.<\/p>\n
Phintraco Sekuritas said the rising probability of a rate hike ahead\nof the Fed\u2019s meeting next week has also drawn attention to the Trump\nadministration\u2019s efforts to prevent such a move.<\/p>\n
US President Donald Trump has threatened to halt trade with countries\nrunning trade surpluses with the United States unless the Fed cuts\ninterest rates, Phintraco said.<\/p>\n
Investors are also watching oil shipments through the Persian Gulf\nfollowing the latest US-Iran conflict, which could heighten concerns\nover energy supplies and global trade.<\/p>\n
Kiwoom Sekuritas Indonesia then added that continued tensions between\nthe United States and Iran and rising risks to Middle East stability\nhave kept geopolitical developments at the forefront of market\nconcerns.<\/p>\n
\u201cThis development has kept investors cautious over potential\ndisruptions to global trade and supply chains,\u201d Kiwoom said. \u201cThe\nRussia-Ukraine conflict also remains a risk factor to watch, as it could\npotentially affect commodity markets and global inflation,\u201d<\/p>\n
Domestically, Kiwoom said activity from Mount Anak Krakatau\u2019s\neruption had disrupted flight operations in several regions.<\/p>\n
\u201cThis disruption could potentially pressure transportation, tourism\nand goods distribution activities should the eruption and volcanic ash\nimpact last longer,\u201d Kiwoom said.<\/p>\n
Meanwhile, the government is continuing its state-owned enterprise\nrestructuring drive by shutting down 290 companies, generating around Rp\n50 trillion in savings. It is targeting the closure of another 700 SOEs\nby the end of 2026, with projected efficiency savings reaching Rp 100\ntrillion.<\/p>\n
The policy could improve SOE efficiency and profitability, Kiwoom\nsaid, alongside accelerated downstreaming of natural resources.<\/p>\n
In regional markets as of 9:14 a.m. Jakarta time, Japan\u2019s Nikkei 225\nrose 2.25%, while South Korea\u2019s Kospi jumped 2.97%. Hong Kong\u2019s Hang\nSeng slipped 0.84% and the Shanghai Composite fell 0.16%.<\/p>\n
On Wall Street on Friday, the Dow Jones Industrial Average fell\n0.51%, the S&P 500 weakened 0.38% and the Nasdaq Composite declined\n0.29%.<\/p>\n
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