Today’s Outlook :
• US MARKET :Wall Street closed mixed on Tuesday as optimism over the interim peace agreement between the U.S. and Iran faded, while investors awaited further details regarding the deal and the Federal Reserve’s interest rate decision.
The S&P 500 fell 0.6% to 7,512.15 and the NASDAQ declined 1.2% to 26,376.34. Meanwhile, the Dow Jones rose 0.6% and reached a new record high, closing above the 52,000 level at 52,002.94.
Markets are also awaiting the Fed’s monetary policy decision on Wednesday, marking the first meeting under new Chair Kevin Warsh. The Fed is expected to keep interest rates unchanged, with attention focused on updated economic projections and postdecision commentary regarding inflation pressures driven by rising energy prices due to the Iran conflict.
On the geopolitical front, Trump stated that the Strait of Hormuz has begun reopening gradually and is expected to be fully operational by Friday. He also announced that the text of the memorandum of understanding (MoU) with Iran would be released on Friday, followed by a second phase of negotiations lasting 60 days after the signing.
Meanwhile, the Bank of Japan (BoJ) raised interest rates to their highest level since 1995 and announced a gradual reduction in bond purchases amid a weakening yen and rising inflation pressures.
On the corporate side, SpaceX remained in the spotlight following its strong IPO debut. After rising around 19% on its first trading day, the stock surged nearly 20% on Monday and gained another 4.8% on Tuesday. SpaceX’s market capitalization is now approaching USD 3 trillion and briefly surpassed Amazon and Microsoft to become the world’s fourthlargest publicly listed company, behind Alphabet, Apple, and Nvidia.
• EUROPEAN MARKET :
European equities posted modest gains on Tuesday as the global relief rally from easing geopolitical tensions started to lose momentum. Investors shifted their focus from peace-related optimism to the details of the agreement’s implementation.
The STOXX 600 rose 0.3%, remaining near record highs. Germany’s DAX gained 0.1%, France’s CAC 40 advanced 0.8%, Italy’s FTSE MIB climbed 1.2%, and Spain’s IBEX 35 rose 0.7%.
Although markets welcomed the initial diplomatic breakthrough in the Middle East, sentiment remained cautious due to the lack of technical clarity regarding the agreement’s implementation. After the conflict previously prompted the ECB to raise interest rates earlier than expected, further market gains will depend on companies’ ability to maintain profit margins amid elevated operating and borrowing costs.
• ASIAN MARKET :Asian markets traded mixed on Tuesday. Japan reached record highs after the BoJ raised interest rates by 25 basis points to 1% as expected and signaled the possibility of further hikes amid inflation risks stemming from higher oil prices.
The Nikkei 225 rose 0.5% to a record high above 70,000 points, while the TOPIX fell 0.3%. South Korea’s KOSPI was the best performer in Asia, gaining 1.8% supported by strength in technology and semiconductor stocks.
The Nikkei 225 rose 0.5% to a record high above 70,000 points, while the TOPIX fell 0.3%. South Korea’s KOSPI was the best performer in Asia, gaining 1.8% supported by strength in technology and semiconductor stocks.
In China, the CSI 300 and Shanghai Composite were flat after May economic data showed weak domestic consumption and investment, although industrial production remained supported by export demand. Meanwhile, Hong Kong’s Hang Seng fell more than 1% due to weakness in technology and internet stocks.
• COMMODITIES : Oil prices fell around 5% to a three-month low on Tuesday as markets expected the U.S. and Iran to reach a peace agreement and reopen oil export routes through the Strait of Hormuz.
Brent crude declined 5.1% to USD 78.92 per barrel, while WTI fell 5.9% to USD 75.95 per barrel, extending losses after reports that the U.S. would allow Iran to resume oil and fuel sales under the two countries’ memorandum of understanding.
Although market sentiment improved following the announcement of the interim U.S.- Iran agreement, investors remain cautious over its implementation as the recovery of shipping activities and energy exports is expected to take several weeks.
• INDONESIA : The JCI closed higher by 4.12% to 6,254.97, driven by gains in KBMI IV major banks and Barito Group stocks, while weakness came from Sinarmas Group’s DSSA.
The decline in global crude oil prices to below USD 80 per barrel is considered a positive implication for Indonesia’s state budget (APBN), as it is expected to ease fiscal pressures and provide positive sentiment for the domestic equity market.
Investors are advised to maintain a trailing stop strategy for selected stocks. If the JCI manages to stay above the 6,250 level, the nearest upside potential is in the 6,375–6,400 range before testing 6,640. However, if it fails to maintain strength, there is a possibility of a correction toward the psychological level of 6,000.
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