The Jakarta Composite Index (JCI) is expected to come under pressure this week due to two major external factors: the escalating Iran-Israel conflict and expectations that the U.S. Federal Reserve will maintain its benchmark interest rate.

Imam Gunadi, an Equity Analyst at PT Indo Premier Sekuritas (IPOT), explained that investors are set to focus on two main events this week. The first is the Federal Open Market Committee (FOMC) meeting scheduled by the Federal Reserve for June 17–18, 2025. At this meeting, the U.S. central bank is widely anticipated to keep the Federal Funds Rate (FFR) unchanged.

The second major concern is the rising conflict between Israel and Iran, which is raising fears of a broader war in the Middle East. According to Imam, countries such as Lebanon (via Hezbollah), Syria, and Yemen (through the Houthi movement) could be drawn into the conflict if tensions escalate further, especially if global powers like the United States become directly involved.

“As a result, Indo Premier Sekuritas projects that the JCI will weaken this week, with support at 6,994 and resistance at 7,239,” Imam stated in a research report released on Monday (June 16, 2025).

To navigate market conditions shaped by the Iran-Israel conflict, Indo Premier Sekuritas is recommending several stocks in the energy and precious metal mining sectors. Three stocks investors should consider, according to the firm, are PT Medco Energi Internasional Tbk. (MEDC), PT Elnusa Tbk. (ELSA), and PT Aneka Tambang Tbk. (ANTM), also known as Antam.

Here are Indo Premier Sekuritas’ Stock Picks for This Week:

1. Buy MEDC (Entry at 1,400; Target at 1,500; Stop Loss below 1,360). The conflict between Israel and Iran has led to a surge in global oil prices due to fears over potential disruptions in supply through the Strait of Hormuz, a critical passageway for the world’s oil exports. Around 20% of the world’s oil supply flows through this strait daily. Oil-exporting countries like Saudi Arabia, Iran, Iraq, Kuwait, and the UAE rely heavily on this route to deliver crude to markets in Asia, Europe, and the Americas. Notably, during U.S.-Iran tensions in 2019–2020, oil prices spiked over 10% in a short period amid threats from Iran to close the Strait.

2. Buy on Breakout ELSA (Entry at 520; Target at 545; Stop Loss below 505). Like MEDC, ELSA has also been affected by the recent conflict. The ongoing Iran-Israel tension has driven oil prices up, reflecting market concerns about potential blockages at the Strait of Hormuz. As this channel accounts for 20% of global oil trade, any disruption could significantly impact major oil-producing countries and energy markets.

3. Buy on Breakout ANTM (Entry at 3,350; Target at 3,600; Stop Loss below 3,240). The geopolitical uncertainty has triggered a wave of investment into safe haven assets like gold. Goldman Sachs projects that gold prices could rise to US$3,700 per troy ounce by the end of 2025. Similarly, Bank of America (BofA) forecasts gold may reach US$4,000 per troy ounce within the next 12 months, with Middle East tensions serving as a major catalyst.