Today’s Outlook:
• The S&P 500 achieved its latest record close on Thursday (13/06/24), on the back of a surge in share prices of chipmakers and increased speculation of an interest rate cut this year driven by further signs of slowing inflation. US PPI aka US producer-level inflation unexpectedly fell in May, by 0.2% last month after rising by 0.5% in April. On an annualized basis, US PPI increased 2.2% after rising 2.3% in April. This followed the weekly Initial Jobless Claims data which showed the number of Americans filing new claims for unemployment benefits jumped to the highest level in 10 months last week (actual 242k versus forecast 225k, versus previous: 229k), raising financial market hopes that the Federal Reserve will have reason to start cutting interest rates in September. The odds of 2 rate cuts after the data is released are now at around 70% even as the Fed on Wednesday signaled to only make 1 cut this year, down from its earlier March forecast of 3 rate cuts. Later tonight will hear from the University of Michigan on consumer expectations for business sentiment and inflation in the next 6 months.
• FIXED INCOME: The US government sold USD 22 billion worth of 30-year bonds on Thursday at lower-than-expected yields, driven by stronger demand. The yield on the 30-Year US Treasury fell to 4.396%, after trading at a session high around 4.491%, pushing other yields lower.
• ASIA & EUROPEAN MARKETS: Industrial Production in the EUROZONE region unexpectedly contracted by 0.1% mom in April, falling from positive growth of 0.5% in the previous month. Some investors are starting to voice concerns whether the economy is slowing down too fast. Later this afternoon, the group’s Trade Balance (Apr) data will be monitored, before investors focus closely on the BANK OF JAPAN’s decision on their interest rate which is not expected to be raised from the last 0.1%. How much CHINA manages to disburse in new credit in May will be the benchmark for whether the world’s second largest economy is moving in a more vibrant direction.
• COMMODITIES: Concerns about a global OIL supply surplus curbing oil’s price potential have been ongoing for months, and will now intensify as Iraq and Kurdistan appear close to a deal that could trigger a new wave of supply. Iraqi Oil Minister Hayan Abdel-Ghani hailed the latest developments in talks with Kurdistan region officials on a deal for Kurdistan to resume oil exports. The talks on the deal come after Iraq’s recent repair of the Kirkuk-Ceyhan oil pipeline – which was shut down in 2014 after being damaged in repeated attacks by ISIS militants – paved the way for a transit capacity of 350,000 barrels of oil per day from Kurdistan to Turkey. Meanwhile in the US, NATURAL GAS prices are in an uptrend along the futures curve, despite apparent delays in the latest US LNG export project. Natural gas prices are already up more than 20% for the year. However, 2024 natural gas prices based on the futures curve have remained flat to date, while 2025 futures prices have increased by around 6% this year.
• JCI still seems to be struggling to maintain the 6850 Support level and it is not impossible that this consolidation journey should still continue until 6800-6750; although RSI positive divergence has appeared approaching Oversold territory. NHKSI RESEARCH advises investors/traders to maintain more of a WAIT & SEE attitude at the end of the week which will continue to be a long-weekend until next Tuesday due to the Eid al-Adha holiday.
Company News
• ERAL: Positive Performance, Sinar Eka Selaras Disburses IDR 51.87 Billion Dividend
• SCCO: Supreme Cable Decides to Distribute Dividends of IDR 75 per Share
• BCAP: Hary Tanoe’s Issuer Prepares IDR 216.4 Billion to Pay Off 2023 Bonds
Domestic & Global News
Cigarette Prices in 2025 Increase Due to Excise, the Amount is Decided in the 2025 State Budget
What Trump Told CEOs in Their Private Meeting
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