Today’s Outlook:
• MARKET SENTIMENT: The Dow Jones Industrial Average surged more than 300 points on Monday and closed at a record high as the benchmark’s postelection rally pressed forward. The 30-stock Dow gained 304 points, or 0.69%, to 44,293.69. The Dow’s rise brought the index above 44,000 for the first time. The S&P 500 added 0.1% to end the day at 6,001.35 and also earned a record close by surpassing 6,000 for the first time. However, the Nasdaq Composite hovered near the flatline, up 0.06% to 19,298.76. Morgan Stanley Wealth management chief investment officer Lisa Shalett wrote in a Monday noted The Republicans’ decisive win has ignited ‘animal spirits,’ despite already lofty expectations.
• ECONOMIC INDICATORS: Focus this week was squarely on upcoming consumer price index inflation data for October, for more signs that inflation is easing. The reading comes just a week after the Fed cut interest rates by 25 basis points, and reiterated that future easing will be largely dependent on the path of inflation. This week’s CPI data is expected to factor into the outlook for rates. While U.S. inflation did fall earlier in the year, it turned sticky in recent months amid persistent strength in the economy and the labor market. Beyond the CPI data, focus this week is also on addresses by a string of Fed officials, who are expected to offer more insight into the central bank’s plans for interest rates. Futures on the federal funds rate have priced in another 25- basis-point rate cut next month, as well as another 67 bps of reductions for 2025.
• ASIA & EUROPEAN MARKETS: Asia-Pacific markets fell Monday after China’s latest stimulus measures underwhelmed and its October inflation numbers came in lower than expected, prompting concerns over the recovery in the world’s second-largest economy. Hong Kong’s Hang Seng index fell 1.62% in its final hour, while mainland China’s CSI 300 climbed 0.66%. to 4,131.13. apan’s benchmark Nikkei 225 was marginally higher at 39,533.32, while the broad-based Topix slipped 0.09% to close at 2,739.68. South Korea’s Kospi was down 1.15%, ending at 2,531.66 and marking its lowest level since Sept. 11, and the small-cap Kosdaq fell 1.96% to finish at 728.84. Beijing’s proposed 10 trillion yuan ($1.4 trillion) package to shore up local government financing, announced late on Friday, did not offer a direct boost to its flagging economy. Thus investor disappointment overshadowed the record run Wall Street closed out with last week. European stocks closed higher on Monday, starting a data-packed week on a positive footing as investors assessed what Donald Trump’s presidency could mean for markets. The pan-European Stoxx 600 index provisionally closed 1.1% higher, with most sectors and major bourses in positive territory. Construction and materials stocks led the gains, ending nearly 2% higher. The benchmark index logged its third consecutive weekly loss on Friday as market participants assessed the likelihood of universal tariffs from President-elect Trump.
– GERMANY: The German DAX gained 1.21% to 19,448.60, but headwinds are looming as investors will scrutinize a fresh batch of economic data this week, including inflation readings in Germany and the U.S. and U.K. gross domestic product (GDP).
• FIXED INCOME & CURRENCY: The U.S. Treasury market was closed Monday for the Veterans Day holiday following sharp postelection moves last week. Those moves came after Donald Trump secured a second presidential term. This week, investors are awaiting the latest inflation reading due on Wednesday as well as the consumer and producer prices data for October set to be published later this week. The consumer data will provide insights about the health of the U.S. economy. The 30-year Treasury yield hit its highest since the end of May last week after the election, while the yield on the 10-year note rose to its highest since early July and the two-year hit its highest since late July.
– The dollar index was 0.56% firmer at 105.59, after hitting 105.50, its highest since July. Last week, it jumped more than 1.5% to 105.44, after U.S. election results showed Trump’s victory.
– China’s yuan weakened as the dollar was still buoyed by America’s higher treasury yields, rising against the yuan to its highest since early August at 7.2332 yuan.
• The euro dropped to its lowest level in 6-1/2 months against the greenback on Monday as investors worried about possible U.S. tariffs that would hurt the euro area’s economy.
• INDONESIA: On Monday, October’s Consumer Confidence declined to 121.1 pts and October’s Car Sales continued its decline by – 3.9% YoY. Today, we are expecting September’s Retail Sales to be released with lower forecasted growth than previous months (TradingEconomics Forecast: 2.5% YoY / Our Forecast: 2.5-3% YoY
Company News
• BUMI: Pefindo Update on Bakrie Group Rating
• ABMM: Maintain Notes Rating
• INCO: Vale Indonesia Collaborates with Chinese Company GEM Co. to Build HPAL Smelter Worth USD 1.4 Billion
Domestic & Global News
Government to Revoke Import License of Companies that Refuse Local Milk Supply
US-Japan Ready to Underwrite, ADB to Boost Climate Change Financing
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