Jakarta. Indonesian stocks struggled to recover on Tuesday after briefly touching a three-month low, as a global technology sell-off, oil prices above $105 per barrel and uncertainty over US inflation weighed on investor sentiment.

Jakarta Composite Index fell 10 points to 5,925. A total of 331 stocks advanced, 345 declined and 287 were unchanged, while trading value reached Rp 10.55 trillion ($589.89 million).

The index struggled to recover after touching a three-month low, tracking losses across Asian markets following a sell-off in technology shares on Wall Street.

Pilarmas Investindo Sekuritas said concerns over artificial intelligence (AI) were weighing on technology stocks as investors reassessed companies' capital spending on AI development amid higher borrowing costs and questions about the potential returns on those investments.

“Competition with Chinese companies has also added pressure on semiconductor stocks. This has allowed negative sentiment from global markets to weigh on domestic stock movements,” Pilarmas wrote in its research note on Tuesday.

Geopolitical uncertainty in the Middle East added to the pressure, with Brent crude prices holding above $105 per barrel amid rising regional tensions, according to Pilarmas.

Higher oil prices have fueled concerns over inflation and the interest rate outlook. If energy prices remain elevated, central banks could have less room to ease monetary policy.

Investors are also awaiting US inflation data for September for clues about the Federal Reserve's next policy moves, Pilarmas said.

Against this uncertain backdrop, the International Monetary Fund (IMF) raised its global economic growth forecast for 2026 to 3.1%, up 0.1 percentage point from its July projection.

However, the IMF's chief economist warned that a prolonged conflict in the Middle East could intensify inflationary pressures while slowing economic growth.

“Worsening fiscal outlooks, a reassessment of AI profitability and extreme weather also pose risks to the global economy,” Pilarmas said.

Across Asia, South Korean stocks bore the brunt of the sell-off. The Kospi plunged 5.5% to 6,035.35, recovering some losses after falling more than 7% intraday to below 6,000. The index had crossed 9,000 in June to reach an all-time high, fueled by the global AI boom.

Japan's Nikkei 225 fell 1.8%, while Hong Kong's Hang Seng Index gained 0.2% and the Shanghai Composite Index rose 0.1%.

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