Tense Day: Economic Data Announced, Purbaya-OJK to Speak Out

Indonesia’s financial markets are expected to face significant pressure today due to the re-escalation of war and rising oil prices. For more on projections for Indonesia’s financial markets, see page 3 of this article.

From the US stock market, Wall Street weakened during Monday’s trading, or early Tuesday Indonesian time.

Stocks fell after the latest developments in the Middle East pushed up oil prices, triggering new concerns about instability in the region.

The Dow Jones Industrial Average index fell 557.37 points or 1.13% to 48,941.90. The S&P 500 weakened 0.41% to 7,200.75, while the Nasdaq Composite eased 0.19% to 25,067.80.

On Monday, the United Arab Emirates stated it had intercepted several missiles fired from Iran. This was the first time the UAE’s missile warning system had been activated since the ceasefire between the United States and Iran began last month.

Oil prices also surged following the incident. US West Texas Intermediate (WTI) crude rose 4.39% to US$106.42 per barrel, while global benchmark Brent crude jumped 5.8% to US$114.44 per barrel.

Earlier on the same day, energy prices had already risen after conflicting reports emerged regarding an Iranian attack on a US warship, as well as Iranian media reports that a ship was forced to turn back from the Strait of Hormuz.

The Iranian Navy stated it had blocked an “American-Zionist” warship from entering the area.

Meanwhile, the Fars news agency reported that two missiles struck a US warship near Jask Island after the vessel ignored warnings. However, both reports have yet to be independently confirmed.

The US Central Command later stated via the X platform that no US Navy ships had been attacked.

In a post on Truth Social on Sunday, President Donald Trump announced “Project Freedom”, a US plan to help free cargo ships from non-conflicting countries trapped due to the closure of the Strait of Hormuz. The programme is scheduled to begin on Monday.

“I have asked my representatives to inform them that we will do our utmost to get the ships and their crews out safely from the strait,” Trump wrote, quoted from CNBC International.

He added that the ships would not return until the area was declared safe for navigation.

Trump’s announcement came after Iran stated it had received a US response to its latest offer for peace talks.

Earlier on Friday, Iran reportedly sent its latest peace proposal through mediator Pakistan, which briefly boosted investor optimism about reaching a deal with the US.

However, Trump later expressed dissatisfaction with the offer and stated that Iran only wanted to negotiate because it no longer had military strength.

Investor hopes for the Middle East situation, along with strong first-quarter earnings performance, had driven stock markets to new records in recent days. Even if the conflict has not ended, Hatfield estimates the S&P 500 could reach 8,000 by year-end.

Logistics sector stocks were the hardest hit on Monday after Amazon announced it would open its own delivery, distribution, and logistics network to businesses. GXO Logistics shares plunged nearly 18%, while UPS and FedEx fell 10% and 9%, respectively.

Indonesia’s financial markets are expected to face significant pressure today. The re-escalation of war and oil prices could pressure the IHSG and the rupiah. The collapse of Wall Street could also serve as a danger alarm.

However, expected stronger economic growth data and easing inflation are hoped to dampen market volatility. The government and the Financial Services Authority (OJK) will also hold two press conferences today.

War Heats Up, Oil Prices Surge

The previously fragile ceasefire between the United States and Iran appeared on the brink of collapse on Monday, when the United Arab Emirates was attacked by Iranian drones and missiles, while the US stated it had sunk Iranian ships in the Strait of Hormuz.

President Donald Trump, in an interview with Fox News on Monday, warned Iran that the country would be “wiped off the face of the earth” if it targeted US ships protecting merchant vessels transiting the strait.

Trump also wrote in a Truth Social post that a South Korean cargo ship had been targeted by Iranian gunfire in those waters. “Maybe it’s time for South Korea to join this mission!” he wrote.

Stock market indices closed sharply lower on Monday, while oil prices rose, as investor concerns grew that the war’s impact on the global economy could worsen or last longer.

This escalation occurred less than a day after Trump announced “Project Freedom”, a US effort to “free” ships trapped due to Iran’s de facto blockade of the Strait of Hormuz.

Despite rising tensions, Trump did not explicitly state that the ceasefire with Iran—which he announced on 7 April and later unilaterally extended—had been violated, according to ABC News journalist Jonathan Karl after speaking with the president by phone.

Admiral Brad Cooper, who leads US Central Command, told reporters on Monday afternoon that American forces had destroyed six small Iranian boats attempting to disrupt merchant shipping movements, according to Reuters reports.

Iranian state media denied that their ships had been sunk.

The UAE Ministry of Defence, in a translated post on its official X account, stated on Monday morning that its air defence system was “currently facing missile and drone attacks coming from Iran.”

The ministry also noted that the sounds heard in various parts of the country were