Array of Prospective Sectors amid Iran-US Geopolitical Tensions
Jakarta – Geopolitical tensions in the Middle East region have intensified following the latest wave of military attacks involving the United States, Israel, and Iran.
This macroeconomic situation has directly triggered fluctuations in global commodity markets, with Brent crude oil prices surging above the USD 73 per barrel level, and global gold prices continuing to demonstrate an upward trend over recent days.
Although the domestic equity market on the Indonesia Stock Exchange (IDX) is currently in a positive and stable condition fundamentally, the external sentiment of threats to global supply chain disruption remains an important variable monitored by market participants.
Precedent: Iran Crisis of June 2025
Historically, the geopolitical crisis involving Iran in June 2025 provides relevant analytical grounds regarding the capital market’s response to external shocks.
During that period, market panic triggered a general capital outflow, but at the same time prompted massive inflows into commodity-based stocks as value protection instruments (safe haven).
The upstream oil and gas sector is at the forefront in responding to supply disruption risks. Threats to strategic maritime logistics routes, particularly the Strait of Hormuz, correlate directly with surges in crude oil prices.
During the June 2025 crisis, domestic energy stocks received consistent accumulation of speculative buying. Issuers such as PT Medco Energi Internasional Tbk (MEDC) recorded solid value appreciation from the beginning of the month until it peaked precisely when escalation intensified on 23 June 2025.
Other energy support issuers, such as PT Elnusa Tbk (ELSA) and PT AKR Corporindo Tbk (AKRA), also experienced temporal strengthening in line with surges in global reference commodities, although when geopolitical tensions heated up there were minor corrections.
Correlation of Precious Metals and Gold Sector
Beyond energy, precious metals mining issuers also received positive catalysts. Gold fundamentally functions as a primary hedging instrument amid the uncertainty occurring to date, with price projections reaching the USD 6,000s according to global investment bank analysts.
The upward trend in global gold prices occurring over recent days has a directional correlation with the valuations of domestic gold mining issuers, with leverage correlations of 2 to 4 times.
Based on last year’s precedent, geopolitical panic drove gold mining company stocks to outperform the average performance of other sectors. Shares of PT Archi Indonesia Tbk (ARCI) and PT Bumi Resources Minerals Tbk (BRMS) accumulated significantly, confirming this sector’s status as the primary option for investors to mitigate portfolio risk.
Accumulation Phase and Correction: Historical Stock Data
The main characteristic of geopolitical sentiment-driven stock movements is their extremely rapid fluctuations. The following is historical data on the movement of six commodity-based issuers from the beginning of the month, peak escalation (23 June), through the profit-taking or massive correction phase (profit taking) on 25 June 2025:
Based on the data above, a clear cycle of short-term speculation is evident. After peaking on 23 June 2025, issuer valuations experienced sharp correction within a two-day period due to mass profit-taking action on 24 and 25 June 2025.
Facing the current situation, despite the fundamental uncertainty of the domestic equity market since the MSCI announcement last January, investors must continue to apply risk limitation discipline and avoid long-term speculation not based on macroeconomic sentiment.
Should this crisis persist and be difficult to resolve, it could trigger additional outflows and potentially increase geopolitical tensions again in the Middle East, disrupting global supply chains and ultimately reducing global market valuations whilst increasing worldwide uncertainty.