Rising Geopolitical Tensions Hit Stocks and Gold

RRI.CO.ID, Jakarta - Indonesia recorded a trade surplus of 3.55 billion US dollars this August. However, this positive news failed to strengthen the Rupiah against the US dollar.

Strong external pressures were the primary driver for the currency's recent decline. Following this trend, many Asian stock markets also opened in the red this morning.

The Jakarta Composite Index continued its downward trend after a brief early rise to 6,018. The index quickly reversed its direction to test the 6,000 level and is projected to move between 5,930 and 6,030.

From a technical perspective, the index could form a new bearish trend if it stays below the psychological 6,000 mark. Despite the broader decline, the Rupiah managed to edge up slightly, reaching a level of 17,930 per US dollar.

Financial market pressures are expected to worsen soon due to escalating conflicts in the Strait of Hormuz. The United States is reportedly considering deploying a new aircraft carrier to the Middle East.

This military move will likely signal a fresh escalation in global conflicts. Consequently, Brent crude oil prices have already rebounded to around $103 per barrel.

High inflation remains a major threat to the financial sector and commodity prices worldwide. Amidst these concerns, gold prices fell to $4,148 per ounce or 2.4 million Rupiah per gram, indicating that geopolitics will heavily dictate short-term market movements.

Writer: Gunawan Benjamin (Economist, UISU)