Mirae warns of market volatility risks amid oil price surge
Jakarta — PT Mirae Asset Sekuritas Indonesia assesses that domestic stock market volatility will continue amid surging energy prices and fluctuating foreign fund flows.
Rully Arya Wisnubroto, Head of Research and Chief Economist at Mirae Asset Sekuritas, stated that escalating conflict in the Middle East has driven up global oil prices whilst increasing uncertainty in financial markets.
“Current oil price levels reflect a significant geopolitical risk premium. If energy supply disruptions persist longer, oil prices could potentially remain above the $100 per barrel level for an extended period,” Rully said during the Media Day: Strategic Allocations to Manage Q1 Market Volatility event in Jakarta on Tuesday.
According to him, such conditions could potentially increase pressure on global inflation, narrow room for monetary policy easing, and trigger stagflation risks in various countries.
As reported, Brent crude oil prices have surged above $100 per barrel following a sharp increase of approximately 35 per cent in a week. The surge was driven by concerns about global energy supply disruptions, including the potential disruption of oil tanker routes through the Strait of Hormuz.
Rapidly rising oil prices are considered likely to slow the global interest rate reduction process whilst simultaneously pressuring stock markets, including in Indonesia.
In recent trading, the Jakarta Composite Index (IHSG) was at 7,585.69, down 1.62 per cent. Meanwhile, the MSCI Indonesia Index (EIDO) weakened 2.70 per cent.
Market pressure was also influenced by continued outflows of foreign capital, with net foreign sales valued at approximately 263 billion rupiah.
However, several commodity-based shares still attracted foreign investor buying interest, including PT Indo Tambangraya Megah Tbk (ITMG), PT Bukit Asam Tbk (PTBA), and PT Bumi Resources Minerals Tbk (BRMS).
At the same occasion, Muhammad Farras Farhan, Senior Research Analyst at Mirae Asset Sekuritas, assessed that the coal sector still demonstrates relative resilience amid the commodity price decline cycle.
In its latest research on ITMG, the company noted stronger performance in the fourth quarter of 2025, with revenue reaching $512 million. This achievement was supported by increased sales volume reaching 6.8 million tonnes and a rise in average selling prices to $75 per tonne.
“ITMG’s performance demonstrates that cost discipline and operational efficiency can help companies maintain profitability even as coal prices are in a decline phase,” Farras said.
According to him, the commodity sector has potential to become one of the pillars of the domestic stock market when global volatility increases, as it typically maintains strong cash flows and is still supported by global demand.
Additionally, ahead of the Eid al-Fitr period, Mirae Asset also sees potential for an increase in domestic economic activity, typically driven by consumer spending.
This momentum was considered capable of providing positive sentiment for sectors related to domestic consumption such as retail, food and beverages, and transportation. Consumer shares such as CMRY and MYOR were assessed as potential considerations for investors given the potential increase in demand ahead of Eid.
The stock market also has potential to gain near-term support from investor portfolio adjustment activities ahead of the extended Eid holiday period. Nevertheless, the market’s direction will continue to be heavily influenced by global sentiment developments and foreign fund flow dynamics.