Today’s Outlook:
• US MARKET : At the closing of NYSE, Dow JonesIndustrial Average gained 327 points, or 0.7%, the S&P 500 climbed 0.1%, and the NASDAQ Composite fell 0.3%. The S&P 500 eked out a gain Wednesday as investors rotated out of tech and into blue-chip names ahead of the confirmation of a deal to end the longest-ever federal government shutdown.
Lawmakers in the U.S. House of Representatives are likely to vote this week on a compromise which would end an historically-long government shutdown. Hopes that the government will soon reopen were bolstered earlier this week, when the U.S. Senate approved a bill to secure federal funding for most agencies until January 30. The bill will now head to the House of Representatives, where the body’s Republican majority means the body is likely to approve the bill, before President Donald Trump signs it into law
For financial markets, reopening the government would mean the return of several official economic indicators, including a monthly jobs report, which have been delayed by the shutdown. These data points are crucial because they help investors and policymakers alike assess the state of the U.S. economy. The data blackout has made the path ahead for Federal Reserve interest rates particularly murky, leaving the outcome of the central bank’s final monetary policy meeting in December largely uncertain.
According to the Wall Street Journal, Fed members remain divided on whether to cut rates at the gathering, after having slashed borrowing costs by 25 points at prior two meetings in October and September. Markets are pricing in a 61.9% chance for a 25 basis point cut in the Fed’s December 10-11 meeting, up from 57.8% yesterday, CME Fedwatch showed.
• EUROPEAN MARKET : The DAX index in Germany gained 1.2%, the CAC 40 in France climbed 1% and the FTSE 100 in the U.K. rose 0.1%. European stocks gained ground on Wednesday, maintaining the positive momentum generated by the likely reopening of the U.S. government. Sentiment in Europe remains positive as the U.S. Congress looked set to end the federal shutdown that started on October 1 and which has sparked disruptions across the country, especially in key sectors such as air travel.
German inflation slowed slightly in October to 2.3%, the federal statistics office said on Wednesday, confirming preliminary data. Inflation, or consumer prices harmonised to compare with other European Union countries, stood at 2.4% year-on-year in September.
The European Central Bank has kept interest rates unchanged since June and says that policy is in a “good place,” and signs that inflationary pressures in the region’s dominant economy are diminishing could mean that monetary policy is set to remain unchanged for some time to come.
• ASIAN MARKET : Most Asian stocks rose on Wednesday with Hong Kong shares rebounding sharply on strength in local technology names, while losses in Softbank Group, after it sold its entire stake in Nvidia, hampered Japan’s Nikkei index.
Hong Kong’s Hang Seng index was among the better performers in Asia, rising 1% in morning trade and closed +0.9%. Mainland China indexes were less upbeat, with the Shanghai Shenzhen CSI 300 and Shanghai Composite indexes moving in a flat-to-low range. Sentiment towards Chinese markets was hurt by reports stating that the country was preparing to restrict the US military from its rare earths. Japan’s Nikkei 225 index was closed +0.4%.
• COMMODITIES : U.S. crude oil futures were little changed on Wednesday, hovering close to post-settlement levels after the American Petroleum Institute showed a smaller-than-expected increase in U.S. weekly crude supplies. An OPEC report saying global oil supply will match demand in 2026, marking a further shift from its earlier projections of a supply deficit. Crude Oil WTI Futures, the U.S. benchmark, recently traded at USD 58.49 a barrel following the report after settling down 4.2% lower at USD 58.49 barrel. U.S. crude inventories increased by about 1.3M barrels for the week ended Nov 5, smaller than expectationsfor a build of about 1.7M barrels.
• INDONESIA : The JCI closed slightly higher by +0.3% but remained in the red zone at 8,388.57, with the next move expected to test the 8,400 resistance and its all-time high (ATH) level. Despite the ATH resistance in the JCI, investors should stay alert to potential corrections and pullbacks, as indicated by the RSI negative divergence. If the JCI experiences a pullback, there remains a possibility of testing the 8,000–8,200 support area. Watch for sector or conglomerate rotation opportunities amid a consolidation phase within the 8,200–8,400 range before the index attempts to retest its ATH again.For today’s trading, along with the significant gold (XAU) price increase of +1.7% yesterday, investors may monitor gold-related stocks, including ANTM, ARCI, BRMS, HRTA, and PSAB (both mining and trading names).
Rotasi ke Old-Dividend Player and Back To Consumer: We continue to recommend allocating part of portfolios toward stocks with dividend yields above bond rates, as well as consumer goods stocks as defensive plays amid ongoing uncertainty in catalysts. This approach allows investors to take advantage of attractive valuation-yield opportunitiesfor portfolio protection.
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