KIWOOM Morning Equity – 21 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. GEOPOLITICAL RISKS OVERSHADOW MARKETS AS INDONESIA REVIEWS A FUEL PRICE CUT US MARKET: Wall Street started Monday's trading higher, but gradually lost its initial gains and moved mixed throughout the session before finally closing in the red zone. S&P 500 fell 0.2% to 7,443.28, Dow Jones Industrial Average weakened 0.6% to 51,839.26, and Nasdaq Composite corrected 0.1% to 25,508.07. The lack of economic data releases as well as the start of the Federal Reserve's communication blackout period ahead of the FOMC meeting made investors shift their focus to the second-quarter earnings season as the next main market catalyst. On another side, rising geopolitical tensions in the Middle East continued to weigh on market sentiment. Wall Street's weakness continued after last Friday ending a two-week strengthening trend due to broad selling in semiconductor stocks that pushed the Philadelphia Semiconductor Index into bear market territory amid concerns over artificial intelligence (AI) sector valuations that are deemed already too high. Rising oil prices due to the escalating US-Iran conflict also pressed sentiment as it triggered inflation concerns again, while Netflix shares weakened after providing disappointing performance projections. INDONESIA: The government opened up the possibility of lowering non-subsidized fuel prices, including Pertamax, if world oil prices continue to experience weakness. The Ministry of Energy and Mineral Resources is currently studying price adjustment formulations that maintain a balance between the purchasing power of non-subsidized fuel consumers and the business sustainability of the oil and gas sector. On another side, the government ensured subsidized fuel prices will not experience an increase until the end of 2026, while national crude oil and fuel supplies are confirmed secure through the end of the year. This policy has the potential to support domestic inflation stability if the downward trend in global energy prices continues. - In addition, Indonesia's risk perception rose again, as reflected in the increase of 5-year and 10-year Credit Default Swaps (CDS) triggered by global oil price spikes, expectations of tighter monetary policy, rising domestic inflation, and rupiah exchange rate weakness. The rise in risk premiums has the potential to push up State Sovereign Bond (SBN) yields, increase corporate funding costs, and trigger foreign capital outflows that could exert further pressure on the rupiah and stock market. Therefore, consistency in maintaining fiscal discipline, monetary stability, and regulatory certainty become important factors to restore investor confidence and safeguard domestic financial market stability. JCI closed higher by 0.91% to the level of 6,231.78 in Monday's trading (20/07), after moving in the range of 6,191.04 – 6,249.90. The strengthening was supported again by foreign investor buying with a net buy of Rp156.57 billion in the Regular Market and Rp93.47 billion across all markets. Foreign fund inflows primarily flowed into TPIA, BRPT, BBRI, BNBR, and DEWA shares, while selling occurred in BMRI, ASII, ANTM, BBNI, and BUVA. On another side, the Rupiah weakened slightly to around Rp17,960 per US dollar after the US dollar strengthened amid rising Middle East geopolitical tensions that pushed oil prices up and triggered US inflation concerns again alongside prospects of high interest rates staying for longer. Technically, JCI movement continued its gains after successfully breaking out of resistance and approaching the EMA50. This condition indicates an opportunity to transition the medium-term trend back from bearish to bullish. From the momentum side, the RSI (14) continued to increase to the 59.04 level. This shows that buying momentum is starting to dominate, but has not yet entered the overbought area, so room for an increase is still available. Chart pattern-wise, JCI still has the opportunity to continue its uptrend to resistance at 6,254 (EMA50) – 6,286; if it manages to break, the potential continues toward the 6,345 – 6,377 level. Meanwhile, a downside scenario under the assumption of being unable to break the EMA50 dynamic resistance means profit taking could likely correct to support at 6,191 – 6,175 (gap area) and 6,108.