Today’s Outlook:
US MARKET: U.S. Treasury yields retreated on Thursday as investors digested mixed U.S. economic and corporate signals. The U.S. economy grew faster than expected in the third quarter, buoyed by robust consumer spending amid a resilient labor market and again defying dire warnings of a recession. But business investment softened as outlays on equipment declined and the boost from the construction of factories faded.

Pushing down Treasury yields was the release of weaker-than-expected U.S. inflation and disposable income data, supporting market sentiment that interest rates are at, or near, their peak. The benchmark 10-year yield last stood at 4.849%, down 10.4 basis points on the day, a pullback from 5.021%, the highest level since 2007 hit earlier in the week.

US ECONOMIC DATA: Later tonight, at around 7:30 pm, market participants will closely monitor the PCE (Personal Consumption Expenditure) Price Index (Sept.) which will be an important input ahead of the FOMC Meeting decision on November 1-2. At the end of this week, the Univ. of Michigan’s views on Inflation Expectations & Consumer Sentiment will be taken into consideration in looking at where optimism for economic conditions is going forward.

EUROPE MARKET: In Europe, the European Central Bank broke the longest streak of interest rate hikes in its 25- year history on Thursday, leaving its main rate at a record high of 4.0%, and saying the latest data continued to point to inflation slowly coming down to its 2% target. 

Corporate News
Releasing IDR 1 T Bonds, Astra Sedaya Finance Gives Coupon of up to 6.45% PT Astra Sedaya Finance (ASDF) plans to issue sustainable bonds phase II 2023 amounting to IDR 1 trillion. The bond issuance is part of the ongoing public offering (PUB) VI bonds with a target fund of IDR 12 trillion. First, the company issued Series A with a principal amount of IDR 188 billion with a fixed interest rate of 6.05% per annum and a term of 370 days from the date of issuance. The last bond interest payment as well as maturity on November 6, 2024. Then the company issued Series B with an amount of IDR 750 billion with a fixed interest rate of 6.40% per annum with a period of 36 months. The last bond interest payment will also mature on October 26, 2026. While Series C, the principal amount is IDR 60 billion with an interest rate of 6.45% with the last bond interest payment at the same time due on October 26, 2028. (Katadata)

Domestic Issue
Releasing IDR 1 T Bonds, Astra Sedaya Finance Gives Coupon of up to 6.45% PT Astra Sedaya Finance (ASDF) plans to issue sustainable bonds phase II 2023 amounting to IDR 1 trillion. The bond issuance is part of the ongoing public offering (PUB) VI bonds with a target fund of IDR 12 trillion. First, the company issued Series A with a principal amount of IDR 188 billion with a fixed interest rate of 6.05% per annum and a term of 370 days from the date of issuance. The last bond interest payment as well as maturity on November 6, 2024. Then the company issued Series B with an amount of IDR 750 billion with a fixed interest rate of 6.40% per   annum with a period of 36 months. The last bond interest payment will also mature on October 26, 2026. While Series C, the principal amount is IDR 60 billion with an interest rate of 6.45% with the last bond interest payment at the same time due on October 26, 2028. (Katadata)

Recommendation
The bullish yield of US10YT is hinging on MA10 Support around 4.87%. A break of this Support will bring US10YT towards MA20 / yield 4.8%. However, if the yield has to slide down again to the lower channel Support of 4.69%, this has not disrupted the short-term uptrend of US10YT. ADVISE: reduce position, set your Trailing Stop.

It is reasonable if ID10YT yield consolidates for a moment after touching the upper channel Resistance almost at 7.3%, just when RSI also shows negative divergence. However, there are still many opportunities for ID10YT to stay above the psychological level of 7.0% in this short-term uptrend. ADVISE: SELL ON STRENGTH, reduce position partially. Support yield range: 7.085% / 7.03%.

Download full report HERE.