Three Alarms for Indonesia: IDX Composite Plummets, Rupiah Falls, and Debt Yields Surge
The Indonesian financial market is expected to continue facing pressure today. Foreign investors recorded a net sell of Rp 447.05 billion.
In the United States, Wall Street markets mostly strengthened during Monday’s trading. The markets rose after chip stocks rebounded from a significant sell-off last Friday. Market sentiment was also supported by US President Donald Trump’s efforts to maintain a fragile ceasefire amidst the ongoing conflict between Iran and Israel. The S&P 5’00 index rose 0.30% to close at 7,405.73, while the tech-dominated Nasdaq strengthened 0.86% to 25,929.66. Meanwhile, the Dow Jones Industrial Average fell 80.77 points or 0.16% to 50,786.01.
Micron Technology, a memory chip manufacturer and a driver of the recent bullish market rally, surged nearly 10% after plunging 13% last Friday. Nvidia and Broadcom shares also closed in the green. The Nasdaq Composite had previously fallen 4.2% on Friday, marking its worst daily decline since April 2025. Investors took profits from chip stocks due to concerns that valuations had become too high amidst economic uncertainty.
Asia-Pacific markets also felt the impact of the previous Nasdaq decline. South Korea’s Kospi led the decline, dropping more than 8% to 7,484.41, while Japan’s Nikkei 225 fell 3.85% to 64,024.6. Meanwhile, the European Stoxx 600 closed slightly lower.
Iran’s attack on Sunday revived concerns regarding the stability of the ceasefire between Washington and Tehran. The missile attacks occurred after the Speaker of the Iranian Parliament, Mohammad Bagher Ghalibaf, stated on X that the US naval blockade and alleged violations of the agreement regarding Lebanon constituted a breach of the ceasefire. Oil prices briefly strengthened after Israel conducted large-scale attacks on strategic defence systems on Monday, according to the Israel Defense Forces (IDF), in response to Iranian attacks. However, Trump stated that Israel and Iran are seeking an immediate ceasefire and negotiations are ongoing despite the attacks. The Iranian Foreign Ministry subsequently stated that Iran’s military operation against Israel had ended, though Tehran warned that hostilities could resume if Israel continues to attack Lebanon.
As developments unfolded, oil prices retreated from their daily highs. US West Texas Intermediate (WTI) crude rose 0.84% to close at US$91.30 per barrel, while Brent strengthened 1.25% to US$94.25 per barrel. William Northey, Investment Director at U.S. Bank Asset Management, noted that the market is weighing various catalysts and risks, suggesting that strong US economic fundamentals remain dominant over Middle East conflict risks, though prolonged conflict could trigger persistent inflationary pressures.
This week, investors will closely monitor US inflation data and the upcoming public debut of Elon Musk’s SpaceX on Friday. The offering is expected to be one of the largest in Wall Street history and could serve as a major test for AI-based stock valuations.
The Indonesian financial market continues to face dynamics ranging from geopolitical warfare to investors monitoring domestic fiscal resilience and global macroeconomic trends. While Iran and Israel both stated they had halted attacks following pressure from President Trump, the situation remains fragile, with both sides warning of potential retaliation if hostilities continue.