Jakarta. Jakarta Composite Index (JCI) closed lower on Tuesday as escalating tensions between the United States and Iran, alongside a weakening rupiah, triggered broad selling pressure across the market.

The benchmark index fell 46 points, or 0.68%, to 6,858, tracking losses across most Asian markets as optimism over a potential US-Iran peace deal faded.

Trading activity remained heavy, with volume reaching 32.52 billion shares and turnover totaling Rp 15.8 trillion ($902.34 million) across more than 2.5 million transactions. Decliners outpaced gainers 463 to 207, while 151 stocks were unchanged.

According to Pilarmas Investindo Sekuritas, market sentiment deteriorated after US President Donald Trump said the ceasefire situation between the US and Iran remained fragile. Trump was also reported to have rejected Tehran’s latest peace proposal, fueling concerns over prolonged disruptions in the Strait of Hormuz.

“The situation has renewed concerns over global energy supply stability and increased demand for safe-haven assets, including the US dollar,” Pilarmas wrote in a research note on Tuesday.

The brokerage added that investors are also closely watching Trump’s planned meeting with Chinese President Xi Jinping later this week. Markets hope the talks could help preserve the still-fragile US-China trade relationship while also addressing Middle East tensions and Taiwan-related issues.

From the domestic side, Pilarmas said pressure on the JCI was exacerbated by the rupiah’s depreciation amid continued US dollar strength. Ongoing geopolitical uncertainty and expectations that the Federal Reserve will maintain elevated interest rates have driven capital flows toward dollar-denominated assets.

“A stronger US dollar is putting significant pressure on emerging market currencies, including the rupiah, increasing investor concerns in the domestic financial market,” Pilarmas said.

As of 9:05 a.m. Jakarta time, Bloomberg data showed the rupiah weakening 98 points, or 0.56%, to Rp 17,512 per US dollar in the spot market, while the US Dollar Index rose 0.19%.

Despite the broader sell-off, several stocks posted strong gains. Nusantara Almazia surged 30.82%, followed by Communication Cable Systems Indonesia, which rose 25%, Pelayaran Nasional Ekalya Purnamasari jumped 24.90%, and Krida Jaringan Nusantara climbed 24%.

On the losing side, Mora Telematika Indonesia dropped 15%, Asia Pramulia fell 14.95%, Itama Ranoraya declined 14.94%, and Pyridam Farma lost 14.74%.

Asian markets traded mixed on Tuesday as optimism fueled by Wall Street’s record rally clashed with concerns over surging oil prices and fears of an overstretched artificial intelligence-driven rally.

Japan’s Nikkei 225 rose 0.6% to 62,828, while South Korea’s Kospi slid 2.7% to 7,610 amid what analysts described as fallout from excessive reliance on fading AI optimism.

“Global equities remain dangerously dependent on a tiny cluster of AI leaders, creating a rally structure that looks powerful on the surface but increasingly fragile underneath,” said Stephen Innes of SPI Asset Management.

Innes said South Korea could become one of the first major economies to enter what he described as “the political redistribution phase of the AI boom.”

Hong Kong’s Hang Seng erased earlier gains to slip less than 0.1% to 26,395, while China’s Shanghai Composite fell 0.4% to 4,210.

On Wall Street overnight, the S&P 500 added 0.2% after hitting a fresh record high on Friday. The Dow Jones Industrial Average gained 95 points, or 0.2%, while the Nasdaq Composite rose 0.1% to another all-time high.

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