KIWOOM Morning Equity – 08 July 2026 This document is for information only and for the use of the recipient. It is not to be reproduced or copied or made available to others. AI VALUATION CONCERNS WEIGH ON MARKETS, SINGAPORE EXPANDS INVESTMENT & 2026 STATE BUDGET DEFICIT PROJECTED AT 2.85% EXCLUDING MBG US MARKET: Wall Street closed lower in Tuesday's trading (07/07/26), led by a sell-off in technology and semiconductor stocks after investors began implementing sector rotation following a strong rally in AI stocks over recent months. S&P 500 index fell 0.45% to 7,503.85, Nasdaq Composite weakened 1.16% to 25,818.69, Nasdaq 100 corrected 1.8%, while the Dow Jones Industrial Average fell 0.25% to 52,925.15. The weakness was triggered by profit-taking in chip stocks after Samsung Electronics released quarterly profit projections that increased sharply but still failed to meet the market's exceptionally high expectations. INDONESIA: Singapore Prime Minister Lawrence Wong conducted a state visit to Indonesia which resulted in a number of new investment commitments. Singapore expressed interest in expanding investments in Indonesia, including the expansion of the Kendal Industrial Park up to 1,000 hectares to attract new investments, create jobs, and drive sustainable economic growth. In addition, Singaporean investor interest in the Batam, Bintan, and Karimun (BBK) region also remains high as the area develops into a digital economy hub. This commitment is deemed credible given that Singapore remains the largest foreign investor in Indonesia, although the government still needs to strengthen human resource quality, ease of doing business, and legal certainty so that investment commitments can be realized quickly into operating projects. - On the fiscal side, Minister of Finance Purbaya Yudhi Sadewa stated that the 2026 APBN deficit projection of 2.85% of GDP has not yet factored in potential budget efficiencies from the Government's Free Nutritious Meal (MBG) Program. The government also sees opportunities for deficit improvement through a decline in world oil prices, an increase in tax and customs revenues, as well as improving economic growth. To optimize state revenues, the government will increase oversight on tax office performance and strengthen the implementation of the digital tax system to increase taxpayer compliance without adding new types of taxes. This step is expected to safeguard fiscal sustainability while keeping the APBN deficit managed below the 3% GDP limit. JCI closed higher by 1.19% to the level of 5,986.50 in Tuesday's trading (07/07), with movement in the range of 5,890.44 – 5,987.01. Although the index continued its gains for five consecutive days, foreign investors still recorded a net sell of Rp205.38 billion, bringing the cumulative year-to-date (YTD) net sell to Rp89.27 trillion. Foreign selling pressure primarily occurred in BMRI, TPIA, MAPI, TLKM, and BRMS, while buying accumulation was recorded in BBCA, BBRI, ADRO, AMMN, and BBNI. From the macro side, positive sentiment came from Indonesia's foreign exchange reserves which increased to USD145.6 billion, surpassing market expectations, thereby strengthening external fundamentals and providing space for Bank Indonesia to safeguard the stability of the Rupiah exchange rate. The Rupiah strengthened slightly to the range of Rp17,980 per US dollar, supported by a weakening US dollar ahead of the release of the Federal Reserve meeting minutes. The increase in foreign exchange reserves also helped shore up market confidence in Indonesia's external stability amid global uncertainties. Technically, JCI continued its gains for 5 consecutive days after successfully achieving a minor breakout above the minor downtrend line and closing at 5,986.50, simultaneously sitting above the EMA10 (5,889) and EMA20 (5,962). This breakout indicates that selling pressure is beginning to diminish and opens up an opportunity for a continued technical rebound in the short term. Even so, the appreciation has not changed the primary trend because the index is still moving within a larger downtrend channel and remains below the EMA50 (6,343), meaning that the medium-term trend still tends to be bearish. Meanwhile, the RSI (14) is at the 47.92 level and continues to move up from the oversold area. This shows that buying momentum is beginning to strengthen, but the RSI remains below the 50 level so confirmation of a trend change toward bullish has not yet fully formed. From a technical perspective, as long as JCI is able to hold above the 5,960 – 5,980 area (EMA20 as well as the breakout area), the opportunity to continue its technical rebound remains open with the first resistance target at 6,045 – 6,100, followed by 6,121 – 6,171. If that resistance is successfully broken, the opportunity for strengthening toward the EMA50 around 6,343 will become increasingly open. Conversely, if JCI falls back below 5,960, the current breakout has the potential to become a false breakout, risking the index testing the support area of 5,900 – 5,882 again, then 5,820, and 5,677 as the major support level. Therefore, confirmation in the form of increasing transaction volume and continued foreign investor accumulation is still required for the trend reversal opportunity to become stronger and more sustainable.