Amid Middle East Conflict: US Announces Critical Development, Purbaya Speaks Out

Indonesian financial markets are expected to face considerable pressure today, despite some rebound occurring following weak performance over the past several days.

The Jakarta Composite Index (IHSG) rebounded strongly on Tuesday’s trading session (10 March 2026) after declining sharply the day before. The IHSG surged 2.2% in early trading and nearly touched the 7,500 level, but ultimately settled with gains of 1.41%, or 103 points, closing at 7,440.91 in the second session. A total of 534 shares rose, 190 fell, and 93 remained unchanged. Trading value reached Rp 19.16 trillion, involving 336.26 billion shares across 2.03 million transactions. Market capitalisation increased to Rp 13.338 trillion.

Nearly all trading sectors strengthened, with the largest gains recorded in energy and raw materials, whilst only infrastructure and technology sectors showed weakness. Major stock movers included DSSA, BRMS, BBCA, BMRI and BYAN.

The IHSG had previously declined sharply on Monday 9 March 2026, touching a low of minus 5.2% at the 7,156 level before paring losses to minus 3.27%, or 248 points, closing at 7,337.37.

Regarding the rupiah exchange rate, the Indonesian currency closed stronger against the US dollar on Tuesday 10 March 2026, aligned with a weakening US dollar in global markets. According to Refinitiv data, the rupiah appreciated 0.47% to 16,855 per US dollar.

This gain reversed the previous session’s weakness, when the rupiah had touched 16,990 per US dollar before closing weaker by 0.15% at 16,935 per US dollar on Monday 9 March 2026. During yesterday’s trading, the rupiah showed strength from the opening, appreciating 0.62% at 16,830 per US dollar and trading within a range of 16,830 to 16,890 per US dollar throughout the session. The US dollar index (DXY) weakened 0.67% to 98.515 at 15:00 WIB.

Rupiah strength was supported by a combination of external and domestic sentiment factors. Externally, the weakening of the US dollar in global markets was the primary factor supporting the rupiah. The US dollar index, which measures the greenback’s strength against six major world currencies, declined during yesterday’s trading after surging sharply the previous day due to market concerns over Middle East conflict escalation.

Pressure on the US dollar began to ease after US President Donald Trump stated in interviews with foreign media that the war against Iran was already “very much concluded”. This statement somewhat reduced investor concerns about prolonged conflict that could potentially disrupt global energy supply and pressure world economic growth.

Regarding the domestic bond market, yields on 10-year Government Securities (SBN) currently stand at 6.692%, down from the previous day’s 6.741%. This rise in yields indicates investor selling activity, with falling prices pushing yields higher.

On the US stock market, Wall Street indices were mostly weaker during Tuesday or early Wednesday Indonesian time trading. Indices fell amid volatile trading as oil prices weakened and market participants continued monitoring developments in the Iran conflict.

The S&P index declined 0.21% to close at 6,781.48. The Dow Jones Industrial Average fell 34.29 points or 0.07% to 47,706.51. Conversely, the Nasdaq Composite rose slightly 0.01% to end at 22,697.10.

Earlier that day, the Dow had plunged up to 296.57 points or approximately 0.6%. At its lowest point, both the S&P 500 and Nasdaq had fallen 0.5% and 0.4% respectively.

Oil prices, which on Monday had surged nearly US$120 per barrel amid heightened concerns about Iran conflict, declined after traders estimated several countries would use emergency oil reserves to mitigate supply disruptions from the conflict.

Oil prices fell further after US Energy Minister Chris Wright stated in a social media post (which was subsequently deleted) that the US Navy had successfully escorted a tanker through the Strait of Hormuz. However, after the post appeared to be deleted, oil prices rose slightly from their lows, whilst stocks fell from their daily highs.

White House spokesperson Karoline Leavitt subsequently stated on Tuesday that the US was not actually escorting a tanker through the Strait of Hormuz.

Market sentiment was further pressured after CBS News reported that the United States had begun seeing indications of Iran preparing to place mines in the Strait of Hormuz.

West Texas Intermediate (WTI) crude futures fell 11.94% to close at US$83.45 per barrel. Brent crude weakened 11.28% to US$87.80 per barrel.

As trading opens mid-week on Wednesday 11 March 2026, global capital market and financial participants face a critical mix of sentiment. Throughout Tuesday, markets digested a series of macroeconomic data releases from the Asia region showing signs of fundamental strengthening, whilst simultaneously monitoring ongoing geopolitical escalation developments in the Middle East that continue triggering energy price volatility.

This morning’s report presents a chronology of market developments throughout yesterday and projects the main focus of investors on Wednesday’s trading, where the US inflation data release tonight will be crucial in determining the direction of subsequent market movements.

Finance Minister Purbaya Yudhi Sadewa will hold a press conference to present the February 2026 state budget condition. This press conference is highly anticipated amid the eruption of the Iran versus Israel-US conflict, with particular interest in whether Purbaya will announce policy measures in response to the unfolding situation.