Today’s Outlook:
• Technology shares pulled Wall Street to a lower close and oil prices soared on Tuesday (12/09/23), as investors looked ahead to US Inflation data, which could provide clues regarding the way forward for the U.S. Federal Reserve’s monetary policy. Nasdaq led all three major US stock exchanges lower by 1% as Cloud services company ORACLE predicted lower-than-expected quarterly earnings, signaling sluggish demand. On the other hand, Energy shares were boosted by rising Crude Oil prices, jumped 2.3% and helped keep the blue-chip Dow Jones to only fall just flat by 0.05%. The US CPI report later tonight at around 7.30pm GMT is eagerly awaited by market participants, who expect the US Inflation rate to rise to 3.6% yoy in August, higher than July’s 3.2%; although Core CPI is expected to ease to 4.3% yoy, lower than 4.7% in the previous month.
• From Continental Europe: The UK reported a much lower than expected increase in unemployment, with only 900 people reporting being out of work in August, but July’s average wage + bonus growth of 8.5% was higher than the 8.2% estimate; this may be due to a surge in job cuts of 207k in July. July’s Unemployment Rate was as expected at 4.3%. Meanwhile the German ZEW Current Conditions (Sept) still views the business climate situation pessimistically, although they are slightly optimistic about the outlook for the next 6 months as reflected in the German ZEW Economic Sentiment (Sept). Overall, the Eurozone also portrayed a relatively pessimistic ZEW Economic Sentiment during the month of September. Today important economic data from the UK will be awaited, namely: GDP (July), Industrial & Manufacturing Production (July), and Trade Balance (July); followed by Eurozone Industrial Production (July) which is predicted to still grow negatively although the weakening has started to slow down.
• Commodities: Oil prices rose to near 10-month highs, triggered by the outlook of tight inventories amid rising global demand predictions based on OPEC’s latest report, potentially extending last summer’s profits which might be reflected in the upcoming Inflation pressures. Gold prices slumped to lower than 2-week lows on the back of USD strength.
• The Dollar Index, which contains the USD’s position against 6 other major world currencies, rallied as the Japanese Yen retreated on the comments of one of Japan’s top bankers who said that perhaps Japan should end its negative interest rate policy soon. The DXY rose 0.15%, while the Euro fell 0.2% and the JPY slipped 0.37%.
• JCI is hanging on to a number of Supports; however it should attempt to break MA10 to continue its bullish swing, testing the psychological Resistance of 7000 again. Therefore, while the current position is attractive for Speculative Buy, NHKSI RESEARCH suggests to hold more buying before JCI breaks the MA10 decisive Resistance at 6970 level.
Company News
• DRMA : Increase the Expansion of Electric Vehicle Component
• CARS : Optimistic to Achieve This Year’s Sales Target
• AALI : Targeting 5% Increase in FFB Production in 2023
Domestic & Global News
• Avoid E-commerce Monopoly, Jokowi Prepares Digital Transformation Task Force
• Oil Prices Jump 2% To Near 10-Month High as OPEC Predicts Tight Supplies
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