Jakarta. Jakarta stocks tumbled on Monday as escalating uncertainty over the Iran conflict and investor caution ahead of MSCI's market classification review triggered broad-based selling across the market.

Jakarta Composite Index (JCI) fell 60 points, or 0.98%, to close at 6,116 after trading between 6,052 and 6,226. Trading volume reached 22.35 billion shares, with turnover of Rp 13.42 trillion ($752.23 million) across more than 1.7 million transactions. Decliners outnumbered gainers 445 to 221, while 147 stocks were unchanged.

Pilarmas Investindo Sekuritas said mounting geopolitical uncertainty in the Middle East remained the primary source of pressure on global markets.

Investors had initially welcomed reports of a proposed 60-day peace roadmap between the United States and Iran, including plans to halt hostilities in Lebanon.

High-level negotiations between US and Iranian officials in Switzerland concluded early Monday, with lower-level technical discussions scheduled to continue throughout the week. Mediators Qatar and Pakistan said the talks had made "encouraging progress."

"However, sentiment shifted quickly after reports emerged that Iran had suspended the talks," Pilarmas said in a research note on Monday.

The brokerage added that tensions intensified again following fresh statements and threats from US President Donald Trump over possible military action if the conflict failed to de-escalate. Investor concerns were further amplified by conflicting reports over the Strait of Hormuz, a critical route for global oil and gas shipments. Iran said the waterway had been closed again over the weekend, while the US maintained that maritime traffic continued uninterrupted.

"The market is increasingly concerned that a peace agreement will not be reached anytime soon, adding to global uncertainty," Pilarmas said.

The heightened risks prompted investors to reduce exposure to risk assets, including equities across Asia.

Domestically, investors also remained cautious ahead of MSCI's market classification review announcement scheduled for June 23, which is widely seen as a key event for foreign fund flows into Indonesia.

"Market participants are adopting a wait-and-see approach ahead of the MSCI review, which could become a major catalyst for foreign investment flows," Pilarmas added.

BRI Danareksa Sekuritas (BRIDS) said market attention is focused on the possibility that MSCI could lift Indonesia's freeze status, which has been one of the factors behind weaker foreign inflows into the domestic equity market.

BRIDS added that the MSCI freeze has weighed on the JCI through three main channels: limiting passive inflows from global index-tracking funds, reducing Indonesia's appeal among foreign investors, and increasing the volatility and selectiveness of foreign fund flows.

Under BRIDS' positive scenario, a constructive assessment from MSCI could help restore foreign investor confidence and encourage the return of both passive and active inflows, providing further support for the benchmark index.

In a negative scenario, MSCI could maintain Indonesia's freeze status or issue an unfavorable assessment, prompting foreign investors to remain on the sidelines, extending capital outflows, and triggering a short-term correction in the JCI.

Elsewhere in Asia, Japan's Nikkei 225 rose 1.6% to a record closing high of 72,353, while South Korea's Kospi gained 0.7% to 9,114.55, also a new record, supported by artificial intelligence-related stocks. Memory chipmaker SK Hynix surged 5.6%.

The Nikkei 225 and Kospi have gained more than 40% and 120%, respectively, over the past six months, driven by enthusiasm surrounding the global AI boom and hopes for a resolution to the Iran conflict.

Hong Kong's Hang Seng Index fell 0.6% to 23,785, while China's Shanghai Composite Index advanced 1.8% to 4,163.

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