Jakarta. Indonesian stocks opened higher on Monday as investors weighed stronger domestic business activity and expectations for this week's Bank Indonesia policy meeting against mounting geopolitical risks that have pushed oil prices sharply higher.

Jakarta Composite Index (JCI) rose to 6,197 at the opening, gaining 22 points or 0.35%. The benchmark traded between 6,191 and 6,224 in early trading.

After several minutes, trading volume reached 1.64 billion shares worth Rp 1.15 trillion ($63.95 million) across more than 182,000 transactions. Advancers outnumbered decliners 332 to 147, while 222 stocks were unchanged.

Phintraco Sekuritas said investors will closely monitor several key domestic indicators this week, including Bank Indonesia's monetary policy decision, credit growth, and M2 money supply data.

The brokerage said domestic sentiment has started to improve after foreign investors posted net purchases for two consecutive trading days last week. However, surging oil prices remain a key risk as they could worsen Indonesia's state budget deficit outlook while fueling inflation, weakening the rupiah, and increasing pressure for higher interest rates.

Bank Indonesia's latest Business Survey showed business activity strengthened in the Q2 2026, with the Weighted Net Balance (WNB) rising to 12.97% from 10.11% in the previous quarter. The improvement was driven by stronger performance in agriculture, forestry and fisheries, construction, mining and quarrying, and accommodation and food services, supported by higher demand during the Eid holidays and the school vacation period.

"For the third quarter of 2026, we estimate business activity will remain in expansion territory, with the WNB at 11.75%, although growth is expected to moderate slightly due to seasonal normalization in the agricultural sector," Kiwoom Sekuritas Indonesia said in a research note on Monday.

"The expansion is projected to remain supported by the manufacturing, trade, construction, and mining sectors, alongside continued growth in employment," Kiwoom added.

External sentiment remained cautious after Wall Street ended lower on Friday, extending weakness in semiconductor shares.

Phintraco Sekuritas attributed the decline to the launch of a new artificial intelligence model by Chinese startup Moonshot AI, which is seen as narrowing the technology gap with the latest models from Anthropic and OpenAI.

"This intensifies concerns over the technology sector's heavy capital spending at a time when end-user demand for AI remains highly price-sensitive," the brokerage said.

Kiwoom added that global sentiment also deteriorated as investors took profits in AI-related stocks while rising oil prices fueled inflation concerns following renewed conflict between the United States and Iran.

The AI sector will face another test this week as several major technology companies are scheduled to report earnings, including Alphabet, Intel, Tesla, and GE Vernova. Investors are also awaiting the European Central Bank's policy decision, as well as inflation, unemployment, and retail sales data from the United Kingdom.

On Friday, the S&P 500 fell 1%, marking its first weekly loss in three weeks and only its third weekly decline since late March. Just days earlier, the index had traded within 0.5% of its record high.

The Dow Jones Industrial Average lost 406 points, or 0.8%, while the Nasdaq Composite slid 1.4%.

Phintraco Sekuritas said escalating tensions between the US and Iran drove oil prices up more than 4% on Friday after the conflict widened. Iran reportedly launched attacks targeting Kuwait, Syria, and Bahrain, while the US struck Iranian targets, including logistics and maritime infrastructure.

The brokerage said further escalation could once again dominate global markets as higher oil prices raise the risk of tighter monetary policy by central banks.

As of 9:08 a.m. Jakarta time, South Korea's Kospi fell 3.33%, Hong Kong's Hang Seng gained 2.05%, and China's Shanghai Composite rose 0.97%. Japan's markets were closed for the Sea Day holiday.

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