Today’s Outlook :
• US MARKET : Wall Street closed higher on Thursday, driven by positive developments in the Middle East conflict and U.S. inflation data. Axios reported that the U.S. and Iran had reached a peace memorandum, although it is still awaiting final approval from President Donald Trump. Market sentiment had previously been volatile amid inflation data releases and the ongoing U.S.-Iran conflict.
The S&P 500 rose 0.6% to 7,563.33, the NASDAQ gained 0.9% to 26,917.47, and the Dow Jones edged up 0.1% to a new record high of 50,669.77. All three major indexes once again posted record closing highs. Market focus was also on the Fed’s preferred inflation gauge. U.S. core PCE rose 3.3% YoY in April, the highest since November 2023 and still well above the Fed’s 2% target. Headline PCE increased 3.8% YoY, the highest since May 2023. However, on a monthly basis, core PCE rose only 0.2%, below expectations of 0.3%.
The earlier surge in oil prices due to the Iran war had also pushed up U.S. inflation and fueled expectations of additional Fed rate hikes. U.S. gasoline prices have jumped more than 50% since the conflict began in late February. U.S. Treasury yields also rose sharply following heavy government bond sell-offs. Meanwhile, U.S. economic growth for Q1-2026 was revised down to 1.6% from the previous estimate of 2%.
From the Middle East, the U.S.-Iran memorandum is said to include a 60-day ceasefire extension, the start of negotiations on Iran’s nuclear program, full reopening of shipping routes through the Strait of Hormuz, and the lifting of the U.S. naval blockade against Iran. Iran is also reportedly committed to not developing nuclear weapons.
• EUROPEAN MARKET :European stock markets opened lower following an escalation of conflict in the Gulf region, threatening the fragile ceasefire between the U.S. and Iran as well as prospects for a peace agreement. The Stoxx 600 fell 0.5%, Germany’s DAX slipped 0.3%, France’s CAC 40 declined 0.2%, and the U.K.’s FTSE 100 dropped 0.8%. The Wall Street Journal reported that the U.S. military launched additional strikes on Iran on Wednesday after Iran attacked commercial ships in the Strait of Hormuz using drones. Although diplomatic efforts are ongoing, no quick resolution has yet emerged for the nearly three-month-long conflict. U.S. forces reportedly shot down drones and struck a drone control center near the southern Iranian port of Bandar Abbas. Meanwhile, Iran’s Revolutionary Guard claimed it had attacked a U.S. base and vowed retaliation against any further attacks.
• ASIAN MARKET :Asian stock markets weakened on Thursday after fresh U.S. military strikes on Iran dampened market optimism over a near-term peace deal. Investors also turned cautious ahead of key U.S. inflation data releases. Market sentiment deteriorated after reports that the U.S. carried out another round of strikes on Iran on Wednesday, marking the second wave of attacks this week. The strikes came shortly after U.S. President Donald Trump denied reports that Iran and Oman would jointly oversee shipping routes through the Strait of Hormuz under a proposed peace agreement.
Japan’s Nikkei 225 fell 0.1% to 64,921.1 after hitting a record high a day earlier. The broader TOPIX index also declined 0.2%. South Korea’s KOSPI dropped 1.1% to 8,139.21 after previously reaching a record high. Chipmaker and AI-related stocks corrected following strong rallies in recent sessions. Hong Kong’s Hang Seng plunged nearly 2% due to weakness in technology stocks. China’s Shanghai Composite fell 0.4%, while the CSI 300 slipped 1.1%.
• COMMODITIES : July Brent crude oil, which expired on Friday, closed down 58 cents or 0.6% at US$93.71 per barrel. Meanwhile, U.S. West Texas Intermediate (WTI) crude rose slightly by 22 cents or 0.3% to US$88.90 per barrel. Oil prices have been volatile in recent sessions amid conflicting signals regarding the potential end of the three-month Iran conflict and the possible reopening of the Strait of Hormuz. Shipping activity through the strategic waterway also remains far below pre-conflict levels.
• INDONESIA : The JCI fell 76.16 points or 1.23% to 6,130 on May 26, 2026. Foreign investors recorded a net sell of IDR1.60 trillion across all markets as the IHSG declined. The weakness was driven by wait-and-see sentiment ahead of the two-day Eid al-Adha holiday on Wednesday and Thursday. In addition, rupiah depreciation also weighed on the IHSG.
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