Jakarta. Jakarta stocks fell 1.22% on Monday as oil prices remained above $110 per barrel, fueling inflation concerns and expectations that interest rates would stay elevated amid escalating Middle East tensions and an upcoming US Federal Reserve policy decision.

Jakarta Composite Index (JCI) shed 66 points to close at 5,373, extending losses after falling 54.29 points, or 1%, to 5,384 at the midday break.

Trading volume reached 36.95 billion shares, with a total transaction value of Rp 14.99 trillion ($826.22 million) across more than 1.81 million transactions. A total of 161 stocks advanced, 520 declined and 112 were unchanged.

Asian markets also came under pressure on Monday as crude oil prices remained elevated, although some regional benchmarks recovered from early losses.

Pilarmas Investindo Sekuritas said elevated energy prices had revived inflation concerns and reinforced expectations that interest rates would remain high.

“Such conditions tend to weigh on risk assets, including stocks, as borrowing costs could remain elevated,” Pilarmas wrote in its research note on Monday.

Geopolitical tensions in the Middle East also continued to weigh on market sentiment, the brokerage said. US President Donald Trump is weighing whether to pursue a deal with Iran or resume military strikes after the US midterm elections, while Tehran was reportedly preparing retaliation that could target Israel and the United Arab Emirates.

“The conflict has driven energy prices higher throughout this year. If oil prices remain elevated, inflationary pressures could persist and limit room for monetary policy easing,” Pilarmas added.

Brent crude rose 3.1% on Friday to settle at $116.72 per barrel, its highest level since June 2022. Prices have climbed from below $97 per barrel in early October.

Investors are also awaiting the Federal Reserve's policy decision this week for clues on the direction of US interest rates. The decision matters for global markets because it could influence the US dollar, international capital flows and the attractiveness of riskier assets in emerging markets, including Indonesia, Pilarmas said.

In Asia, investors are monitoring the Fifth Plenum of the Chinese Communist Party, scheduled to run through Oct. 26–27, 2026, for signals on China's economic priorities and future policy direction.

Chinese President Xi Jinping and senior party leaders began the high-level meeting in Beijing on Monday. Its outcome is drawing investor attention because China's economic policies could influence regional growth prospects and market sentiment.

Domestically, Pilarmas warned that rising oil prices could also strain Indonesia's fiscal position. As a net oil importer, Indonesia faces the risk of higher state budget spending as global energy costs rise.

“This is especially the case if higher energy prices increase the need for energy subsidies and compensation,” Pilarmas added.

Tokyo's Nikkei 225 fell 0.8% on Monday ahead of the Bank of Japan's interest rate decision later this week. South Korea's Kospi dropped 1.5%, while Hong Kong's Hang Seng Index gained 0.5%. China's Shanghai Composite Index recovered from early losses to rise 0.2%.

On Friday, Wall Street extended its losses as the S&P 500 fell 0.5%, marking its second consecutive weekly decline after losing ground the previous day. The Dow Jones Industrial Average dropped 1.2%, while the Nasdaq Composite slipped 0.2%.

Add as a preferred source on Google +