Today’s Outlook :
• US MARKET : Wall Street closed sharply lower on Wednesday after President Donald Trump escalated his rhetoric against Iran and reaffirmed that the U.S. would launch further strikes against Iran. Although U.S. inflation data came in largely in line with expectations, escalating geopolitical tensions between Washington and Tehran dominated market sentiment.
The S&P 500 Index fell 1.6% to 7,267.65, the NASDAQ declined 2% to 25,169.50, and the Dow Jones plunged 1.9% to 49,919.09. Market concerns increased after the U.S. launched strikes against Iran in response to the downing of a U.S. military helicopter in the Strait of Hormuz, reducing hopes for a peace agreement in the Middle East.
From an economic perspective, U.S. consumer inflation (CPI) in May rose 0.5% month-onmonth (MoM) and 4.2% year-on-year (YoY), mainly driven by higher energy and gasoline prices due to the Middle East conflict. Meanwhile, core CPI increased 0.2% MoM and 2.9% YoY, slightly better than market expectations.
The technology sector, particularly semiconductor stocks, came under pressure again. The Philadelphia Semiconductor Index (SOX) fell 3.6%, with stocks such as Qualcomm, Arm, and Marvell recording significant losses. Sentiment in the AI sector also weakened amid concerns over the sustainability of massive investments in AI data center development, particularly following disappointing earnings from Broadcom and Google’s capital raising plan. In addition, Super Micro Computer plunged nearly 28% after announcing plans to raise USD 7 billion to support new hardware purchases.
• EUROPEAN MARKET : European stocks closed mixed on Wednesday after U.S. inflation data that came in line with expectations eased concerns over a near-term Federal Reserve rate hike and helped stabilize risk sentiment. The STOXX 600 Index edged down 0.1% after touching its lowest level since May 20. Germany’s DAX fell 0.9%, France’s CAC 40 declined 0.5%, and Italy’s FTSE MIB dropped 0.5%. Meanwhile, the UK’s FTSE 100 was the outlier, rising 0.3%. Investor attention now turns to the European Central Bank (ECB) policy decision on Thursday, where policymakers may signal a more hawkish stance as rising energy prices threaten to reignite inflationary pressures.
• ASIAN MARKET : Asian stock markets declined on Wednesday due to increased risk-off sentiment following the renewed military escalation between the U.S. and Iran. The recovery in technology stocks also failed to hold, putting pressure on the semiconductor sector.
South Korea’s KOSPI was the worst-performing index in Asia, falling 4% due to renewed selling pressure in chip stocks after experiencing a major sell-off earlier in the week. Concerns over the sustainability of the AI investment trend also weighed on the sector
In Japan, the Nikkei 225 fell 1.1% and TOPIX declined 0.7%. Japan’s producer price inflation (PPI) in May came in higher than expected due to rising fuel costs caused by the Iran conflict, increasing speculation that the Bank of Japan may raise interest rates again.
Meanwhile, China’s CSI 300 fell 1% and the Shanghai Composite declined 0.6%. China’s lower-than-expected consumer inflation (CPI) indicated weak domestic consumption, while producer inflation (PPI) surged to its highest level in nearly four years due to rising oil and other commodity prices caused by supply disruptions from the Middle East.
• COMMODITIES : Oil prices continued to rise during Asian trading on Thursday after the U.S. launched fresh strikes against Iran and Tehran responded by announcing a halt to all vessel traffic through the Strait of Hormuz. Brent crude rose 2.1% to USD 95.02 per barrel, while WTI jumped 2.6% to USD 92.33 per barrel, extending gains of nearly 2% from the previous session.
U.S. President Donald Trump stated that the U.S. would strike Iran very hard if negotiations failed. Following the latest U.S. attacks, Iran’s military declared the Strait of Hormuz closed to all vessels, including oil tankers and commercial ships, and warned that any vessel attempting to pass through the waterway would be targeted.
The Strait of Hormuz is one of the world’s most important energy transit routes, carrying a significant portion of global seaborne crude oil exports. Tensions escalated after the U.S. previously attacked Iranian targets in retaliation for the downing of a U.S. Apache military helicopter near the Strait of Hormuz.
On the other hand, Trump revealed that the U.S. military had helped escort oil shipments through the Strait of Hormuz, with more than 100 million barrels of oil having passed through the route under U.S. protection, highlighting the importance of keeping this energy trade route open.
• INDONESIA : The JCI closed higher on Wednesday at 5,902.38, gaining 2.71%, supported by gains in conglomerate stocks and conventional large-cap stocks, particularly BBCA, which surged nearly 10%.
The Indonesian government appears to be starting to respond to feedback from the capital market. A meeting between the Vice Speaker of the Indonesian House of Representatives (DPR RI), Danantara’s COO, and several CEOs of state-owned banks (Himbara) resulted in a planned share buyback of fundamentally strong state-owned enterprises (SOEs), particularly banking stocks, which helped calm market sentiment. The market is currently awaiting the realization of the buyback plan.
Today, if the index fails to break out above the 6,000 level, there is a possibility that it will form a new base and undergo a correction while adjusting to the impact of the massive U.S. strikes against Iran.
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