Today’s Outlook :
• US MARKET : Wall Street closed lower on Wednesday after the Federal Reserve kept interest rates unchanged at 3.50%–3.75%, as widely expected, but signaled the possibility of a 25-basis-point rate hike before year-end. Market sentiment was briefly supported by President Donald Trump’s statement that a U.S.-Iran peace agreement would soon be signed and the Strait of Hormuz would reopen although investors ultimately shifted their focusto the Fed’s more hawkish stance.
The S&P 500 fell 1.2% to 7,420.72, the NASDAQ declined 1.4% to 26,021.66, and the Dow Jones Industrial Average slipped 1.0% to 51,493.16.
The Fed kept rates unchanged at its first FOMC meeting under new Chair Kevin Warsh. However, the latest dot plot projected the federal funds rate at 3.8% by the end of 2026, up from the previous 3.4% forecast, implying one 25-basis-point rate hike this year. The updated outlook boosted the U.S. dollar and pushed Treasury yields higher.
Warsh also unveiled a broad overhaul of the Fed’s monetary policy communication by simplifying the FOMC statement and reinforcing the central bank’s primary focus on price stability. On the corporate front, SpaceX shares fell 5%, ending their strong rally following last week’s blockbuster IPO debut.
• EUROPEAN MARKET : European equities closed slightly higher on Wednesday as investors remained cautious ahead of the Fed’s interest rate decision, following a foursession rally driven by easing geopolitical tensions. The STOXX 600 gained 0.5%, extending its roughly 3% advance over the past four trading sessions.
Major European indices posted mixed performances, with Germany’s DAX rising 0.2%, Italy’s FTSE MIB gaining 0.4%, and Spain’s IBEX 35 jumping 1.3%, while France’s CAC 40 edged down 0.2%.
The DAX’s gains were limited after BMW cut its annual profit forecast, sending its shares down 6.8% and weighing on other automakers, including Volkswagen and Mercedes-Benz.
On the macro front, the Eurozone’s May CPI showed a month-on-month slowdown, easing concerns over further ECB rate hikes driven by elevated energy prices. Investors also continued to monitor developments surrounding the implementation of the interim U.S.-Iran peace agreement, which is expected to support broader market stability.
• ASIAN MARKET : Most Asian markets closed higher on Wednesday, with Japan’s Nikkei 225 remaining near record highs, supported by gains in technology stocks. However, broader market gains were capped as investors awaited the Fed’s policy decision
The Nikkei 225 rose 0.6%, staying close to the record high above 70,000, while the TOPIX gained 0.75%. Semiconductor and industrial stocks led the gains, supported by optimism over sustained demand driven by artificial intelligence (AI). In addition, Japan’s May trade data showed exports were boosted by AI-related electronics and semiconductorsales, resulting in a smaller-than-expected trade deficit.
In China, the CSI 300 rose 0.3%, while the Shanghai Composite slipped 0.1%. Meanwhile, Hong Kong’s Hang Seng declined 0.75% after earlier economic data pointed to continued weakness in China’s economy.
South Korea’s KOSPI traded largely flat after experiencing heightened volatility in recent sessions due to fluctuationsin domestic semiconductorstocks.
• COMMODITIES : Oil prices closed nearly 1% higher on Wednesday after U.S. President Donald Trump stated that the ceasefire agreement with Iran was not yet final and that military operations could resume if Iran failed to comply with its commitments. However, gains remained limited by concerns over a potential global oil supply surplus next year.
Brent crude rose 0.75% to USD 79.55 per barrel, while WTI crude gained 0.97% to USD 76.79 per barrel. Trump emphasized that the Memorandum of Understanding (MoU) with Iran was still being finalized and warned that military action could resume if the agreement proved unsatisfactory or if Iran failed to honor its commitments. Earlier, the U.S. and Iran had announced an initial agreement to end the conflict and reopen the Strait of Hormuz, one of the world’s most critical oil shipping routes.
• INDONESIA : The JCI finally closed 0.55% lower at 6,220.74, mainly dragged down by declines in Barito Group stocks, while DSSA from the Sinarmas Group also weighed on the index.
The decline in global crude oil prices to below USD 80 per barrel is viewed as a positive development for Indonesia’s state budget (APBN), as lower energy prices are expected to ease fiscal pressures and provide a supportive backdrop for the domestic equity market throughout this week.
Investors are advised to maintain trailing stop strategies on their selected stocks. If the JCI successfully breaks above the 6,250 level, the next upside targets are in the 6,375– 6,400 range before potentially testing 6,640. However, failure to sustain gains above that area could see the index retest the psychological 6,000 level.
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