Today’s Outlook :
• US MARKET : Wall Street closed mostly lower on Wednesday after the Fed held interest rates steady as expected. Sentiment was also pressured by rising diplomatic tensions between the US and Iran. Aside from the Fed and the Middle East conflict, investors are also awaiting quarterly results from at least four members of the “Magnificent 7” after the market close. The S&P 500 and NASDAQ indices were nearly unchanged at 7,136.52 and 24,673.24, respectively. Meanwhile, the Dow Jones Industrial Average fell 0.6% to 48,861.68.
The Fed once again kept interest rates at 3.50%–3.75% in a decision expected to be the final move under Jerome Powell’s leadership. The decision recorded the highest number of dissents since 1992, with one policymaker favoring a 25 bps rate cut and three opposing any easing bias signal. Inflation has picked up again due to rising oil prices driven by the Iran war, while the US labor market remains in a “low hire, low fire” condition. Powell’s term will end in May and he is likely to be replaced by Kevin Warsh, a nominee backed by Donald Trump.
In the Middle East, a Wall Street Journal report stated that Trump has requested preparations for a prolonged naval blockade of Iran’s ports. US– Iran negotiations remain at a standstill, while Iran has closed the Strait of Hormuz, pushing oil prices higher. Iran has also rejected a three-stage US proposal, while the US continues to demand a halt to uranium enrichment for up to 20 years.
• EUROPEAN MARKET : European stocks declined as investors weighed corporate earnings, developments in the Middle East conflict, and global interest rate decisions. The Stoxx 600 fell 0.6%, Germany’s DAX dropped 0.3%, France’s CAC 40 declined 0.4%, and the UK’s FTSE 100 fell 1.2%. Rising oil prices are a concern as they could drive inflation and influence central bank policies.
• ASIAN MARKET : Asian markets traded mixed amid US–Iran tensions and caution ahead of the Fed decision, along with strong inflation data from Australia. Sentiment was also weighed down by reports that OpenAI missed its user and revenue targets.
South Korea’s KOSPI rose 0.2%, while Japan was closed for a holiday. In China and Hong Kong, markets were mixed: Hua Hong Semiconductor fell more than 7% due to potential US restrictions, while other tech stocks remained supported by optimism around low-cost AI from DeepSeek. The Shanghai Composite gained 0.4% and the CSI 300 rose 0.7%.
• COMMODITIES : Oil prices surged following reports of a US naval blockade and Iran’s rejection of a peace proposal. The Strait of Hormuz remains closed, tightening global supply. Brent rose 6.2% to $118.11 per barrel, while WTI climbed 6.8% to $106.74 per barrel.
Goldman Sachs assesses that the United Arab Emirates’ (UAE) exit from OPEC could increase the risk of higher oil supply in the medium term. The UAE will leave OPEC+ starting May 1, weakening the group’s control over global supply but giving the country more room to raise production if export routes reopen. UAE production is projected to reach around 4.5 million bpd by early 2026.
• INDONESIA : The JCI rose +0.41% in the green zone, rebounding to 7,141, with the last support level at the psychological range of 7,000–6,950. The Indonesian market is starting to show resilience to US–Iran geopolitical sentiment, and the government has begun addressing related impacts, such as preparing plastic subsidies and other measures. Selling pressure from big banks remains significant. Pressure from BREN and DSSA continues to weigh on the IHSG following their exclusion from LQ45, IDX30, and IDX80. However, after the HCL release, a positive takeaway is that IDX’s adoption approach aligns with MSCI standards.
Caution is still advised regarding selling pressure from big banks. While valuations appear attractive, selling pressure remains high amid Indonesia’s macroeconomic contraction. Commodities remain appealing, particularly nickel prices, which are approaching the psychological level of USD 20,000.
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