Today’s Outlook :
• US MARKET : Wall Street closed lower on Tuesday after AI-related stocks corrected, driven by concerns over OpenAI. The S&P 500 fell 0.5% to 7,139.24, the NASDAQ Composite dropped 0.9% to 24,663.80, and the Dow Jones Industrial Average slipped 0.1% to 49,136.15, after earlier falling deeper by as much as 0.8% and 1.5%, respectively.
The decline was triggered by a report from The Wall Street Journal stating that OpenAI failed to meet its internal user and revenue targets. The company also reportedly missed its target of reaching 1 billion weekly active users for ChatGPT by the end of 2025 and fell short of several monthly revenue targets this year, raising doubts about the sustainability of heavy spending on data centers and AI infrastructure.
Market pressure was concentrated in semiconductor and AI stocks such as Nvidia, Advanced Micro Devices, and Broadcom. Sentiment was also weighed down by elevated oil prices following disruptions in the Strait of Hormuz. President Donald Trump said Iran was in a “state of collapse” and wanted the Strait of Hormuz reopened as soon as possible.
Investor focus has now shifted to earnings from the “Magnificent Seven”—including Microsoft, Meta Platforms, Amazon, Alphabet, and Apple—which account for a large portion of market capitalization. Attention is also on the Federal Reserve policy meeting, with markets awaiting signals from Chair Jerome Powell regarding inflation and growth amid rising oil prices and geopolitical tensions.
• EUROPEAN MARKET :European stocks mostly closed lower on Tuesday as investors assessed reports that President Donald Trump may not accept Iran’s proposal to end the two-month conflict, while also digesting corporate earnings releases. The Stoxx Europe 600 fell 0.4%, DAX declined 0.2%, and CAC 40 dropped 0.5%, while the FTSE 100 was the outlier, rising 0.1%.
• ASIAN MARKET : Asian stocks were mixed on Tuesday amid elevated oil prices and geopolitical uncertainty, while the Bank of Japan held interest rates as expected.
BOJ kept its policy rate at 0.75% (6–3 vote) and reiterated that rate hikes will be implemented gradually depending on economic conditions and the Middle East conflict. The central bank also expects inflation expectations to continue rising moderately, reinforcing the possibility of further tightening this year. The Nikkei 225 fell 0.7% to 60,107.50 after hitting a record high, while TOPIX rose 0.8%.
In South Korea, the KOSPI was an outlier, rising more than 1% to a new record high. Regional sentiment remained pressured by high oil prices due to disruptions in the Strait of Hormuz, fueling inflation concerns and dampening risk appetite. Asian tech stocks also declined, tracking global caution ahead of U.S. earnings and increasing scrutiny over AI valuations.
A report from The Wall Street Journal said OpenAI missed user and revenue targets ahead of a potential IPO, raising doubts about near-term monetization in the AI sector. Meanwhile, the Shanghai Composite edged down 0.1% and the Hang Seng Index fell 0.7%.
• COMMODITIES : Oil prices edged lower from a three-week high on Wednesday as markets weighed the decision by the United Arab Emirates to exit OPEC. However, uncertainty over the U.S.–Israel conflict with Iran continued to limit the decline, especially as the Strait of Hormuz remained closed and prospects for a peace deal between Washington and Tehran appeared distant.
Brent crude oil fell 0.6% to USD 110.65 per barrel, while West Texas Intermediate declined 0.9% to USD 99.05 per barrel, after both surged more than 3% on Tuesday.
The UAE’s exit—effective Friday—marks a blow to the oil-producing group amid ongoing supply disruptions from the Iran conflict. The move is aimed at prioritizing “national interests,” but could create tensions with Saudi Arabia as OPEC’s de facto leader. The UAE is expected to increase production, given its past objections to OPEC quotas.
However, any production increase is likely to occur only after shipping routes through the Strait of Hormuz reopen. For now, that scenario remains distant as the strait is still closed and further U.S.–Iran negotiations have yet to show progress
• INDONESIA : The JCI remains declined 0.48% to 7,072.39, approaching key psychological support at 7,000–6,950. The Indonesian market appears increasingly resilient to U.S.–Iran geopolitical sentiment, with the government beginning to address related impacts, including drafting plastic subsidies and other measures.
Selling pressure from big banks remains significant. Additional pressure from Barito Renewables Energy (BREN) and DSSA continues to weigh on the index following their exclusion from LQ45, IDX30, and IDX80. However, the positive side is that IDX’s adoption framework now aligns more closely with MSCI standards.
Investors are advised to remain cautious of ongoing selling pressure in big banks. While valuations appear attractive, selling pressure remains heavy amid Indonesia’s macroeconomic contraction. Commodities remain appealing, particularly nickel prices, which are approaching the psychological level of USD 20,000.
Download full report HERE.
