JCI finished at a sharp tumble due to the rupiah depreciation at -1.8% for 4 consecutive days and massive foreign net sell. Top Losers: Basic Industry (-3.45%), Finance (-2.44%), Consumer (-1.89%).
The global market tumbled yesterday. Investors concerned about the 10-year Treasury yield hit highest within recent days. It was snapped higher by Jerome Powell’s hawkish stance.
Today’s Outlook: The U.S. Bond Yields
We estimate that today JCI rallies with the support range of 5710-5716 and resistance range of 5800-5810. The U.S government bond yield increased to 3.2%, the highest level in 7 years, after the robust U.S. macroeconomic data. We estimate that the hike in yield indicated that global investors tempted to invest in riskier assets such as investment in emerging market. On the other side, the correction of 2.7% to global crude prices signed that global market is overreacted into the jitters of the U.S. sanctions on Iran.
From the domestic outlook, today investors focus on September’s forex reserves. Because the rupiah was stable in September, the decline in forex reserves likely halted in September.
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