Today’s Outlook :
• US MARKET : U.S. stocks ended mixed on Friday in a relatively flat trading session. Declining oil prices and gains in the real estate sector offset weakness in semiconductor stocks. However, Wall Street posted a weekly decline due to escalating tensions in the Middle East, concerns over heavy AI spending by Alphabet and Tesla, and renewed trade tensions after the Trump administration imposed new tariffs.
The S&P 500 index rose 0.1% to 7,412.62, the Dow Jones gained 0.5% to 51,946.51, while the Nasdaq Composite fell 0.6% to 24,975.82.
Oil prices corrected on Friday after a sharp rally in the previous session, but Brent still posted an increase of around 11% for the week. The rise reignited inflation concerns and could prompt central banks, including the Fed, to maintain tighter monetary policy.
On the geopolitical front, the U.S.-Iran conflict continued, with the U.S. military launching its 13th consecutive night of strikes against Iran, while Tehran continued targeting U.S. military bases in Bahrain, Kuwait, and Jordan.
The AI trade also remained a key focus this week. Although semiconductor stocks had entered bear market territory, the Philadelphia Semiconductor Index rebounded 1.2% over the week. Intel also reported quarterly results above expectations, supported by demand for chips used in AI applications.
Meanwhile, trade tensions intensified after President Donald Trump imposed new tariffs of 10%-12.5% on imports from 60 major U.S. trading partners, replacing the temporary 10% global tariff that had expired. The U.S. government stated that the policy was implemented because trading partners had not adequately enforced bans on imports of goods produced through forced labor.
• EUROPEAN MARKET : European stocks ended higher on Friday after recording their steepest daily decline in two weeks in the previous session. Sentiment was supported by solid corporate earnings, while investors continued to assess the impact of higher oil prices on the monetary policy outlook.
The STOXX 600 index rose 0.6% to 644.67 and recorded gains for two consecutive weeks. Germany’s DAX also advanced, supported by a 10% surge in SAP shares after the company reported second-quarter current cloud backlog growth above analyst expectations.
The European technology sector index gained 1.7%, recovering some losses after quarterly reports from STMicroelectronics and BE Semiconductor previously disappointed the market. Investors continued to balance AI-driven growth prospects against high valuations and significant investment requirements, leading to volatility in technology stocks.
Meanwhile, several European Central Bank (ECB) policymakers stated that interest rates could potentially be raised again as inflation risks remained elevated. Markets are currently pricing in a 25-basis-point rate hike, with around a 70% probability of another increase by the end of 2026.
• ASIAN MARKET: Asian stocks plunged on Friday, led by declines in Japan and South Korea after President Donald Trump’s new tariffs on imports from 60 trading partners officially took effect. Market sentiment was also pressured by surging oil prices and U.S. technology earnings.
The new U.S. tariffs of 10%-12.5% on nearly all imports came into effect on Friday, replacing the expired temporary 10% tariff. The policy increased concerns over the global trade outlook, particularly for export-dependent Asian economies.
Japan’s Nikkei 225 dropped 3.2%, extending losses for the third consecutive week, while South Korea’s KOSPI plunged 5.8%. Hong Kong’s Hang Seng and China’s CSI 300 each declined 1.3%, Australia’s S&P/ASX 200 fell 1.0%, and Singapore’s STI dropped 0.5%.
Japan’s decline came despite an increase in June core inflation, which remained below the Bank of Japan’s 2% target, reinforcing expectations that future rate hikes would be implemented gradually. In South Korea, semiconductor stocks were the main drag after tracking weakness in U.S. technology stocks.
Despite Friday’s correction, China’s CSI 300 remained on track to record a weekly gain of around 3.2%, driven by expectations that next week’s Politburo meeting could deliver additional stimulus measures to support economic growth.
• COMMODITIES : Oil prices extended losses on Monday, falling more than 5%, after U.S. President Donald Trump paused strikes against Iran following two weeks of military operations. The move raised hopes for a diplomatic solution that could ease tensions in the Middle East. Brent crude fell USD5.58 or 5.77% to USD91.20 per barrel, while WTI declined USD4.91 or 5.50% to USD84.40 per barrel.
• INDONESIA : The JCI closed Friday’s trading session down 1.88% at 6,196.43. The IHSG correction was driven by concerns over benchmark crude oil prices returning toward USD100 per barrel. However, after Friday’s market close in Indonesia, oil prices declined again after nearly reaching that psychological resistance level. Geopolitical pressures appear to remain a sentiment factor that could be absorbed by the IHSG, potentially leading the index to retest its nearest support level at 6,000. For today’s session, if the IHSG fails to hold above 6,200, the index remains vulnerable to retracing toward the psychological level of 6,000.
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