Today’s Outlook:

• MARKET SENTIMENT: U.S. stock futures were little changed Wednesday night, as the major averages’ postelection run began to show signs of stalling. Dow Jones Industrial Average futures rose by 14 points, or 0.03%. S&P 500 futures climbed 0.01%, while the Nasdaq 100 futures dipped 0.03%. CNH Industrial shares jumped nearly 8% in extended trading after Greenlight Capital’s David Einhorn told attendees at CNBC’s Delivering Alpha conference that he took a medium-sized position in the agricultural equipment company. On Wednesday, the 30-stock Dow and S&P 500 closed out the regular session near the flatline, with the former rising 47.21 points, or 0.11%, and the latter eking out a 0.02% gain. The Nasdaq Composite ended the session down by 0.26%. Those moves come after the October consumer price index came in as expected, but nevertheless signaled the Federal Reserve’s fight against inflation is yet to be won. Core CPI rose by 0.3% for a third straight month, with the 12-month rate at 3.3%.

• ECONOMIC INDICATORS: On the economic front, the October producer price index will be released Thursday, and the retail sales report is due out Friday.

• ASIA & EUROPEAN MARKETS: Asia-Pacific stock markets mostly fell Wednesday, tracking losses on Wall Street as the U.S. postelection rally stalled overnight. Asian traders assessed corporate goods data out of Japan, which showed year-on-year producer price growth, or wholesale inflation, in October reached its highest since July last year at 3.4%. That was higher than the 3% growth expected by economists polled by Reuters, and the 2.8% rise in September. Japan’s Nikkei 225 fell 1.66% to end at 38,721.66, while the Topix declined 1.21% to 2,708.42. South Korea’s Kospi fell 2.64% to finish at 2,417.08, while the Kosdaq Index lost 2.94% to end 689.65. Australia’s S&P/ASX 200 dropped 0.75% to end at 8,193.4. Hong Kong’s Hang Seng Index was down 0.45% as of its last hour of trade, while mainland China’s CSI 300 rose 0.62% to close at 4,110.89. Investors have been assessing what the re-election of Donald Trump in the U.S. could mean for Chinese equities and Beijing’s stimulus policy. European stocks closed lower on Wednesday, with global markets assessing the latest U.S. inflation data. The pan-European Stoxx 600 index provisionally ended the day 0.17% lower after paring back some earlier losses. Most sectors pulled back, with tech stocks falling 1.2% while oil and gas stocks added 1.3%.

– On Thursday, the US’ October producer price index will be released. And The International Energy Agency, which has a much lower demand growth forecast than OPEC’s, is set to publish its updated estimate

– Oil rebounded on Wednesday on short-covering after prices fell near a two-week low in the prior session on OPEC’s demand forecast cut, while the dollar hit a seven-month high, capping crude’s gains. Brent crude futures rose 39 cents, or 0.54%, to close at $72.28 a barrel, while U.S. West Texas Intermediate crude futures gained 31 cents, or 0.46%, to settle at $68.43. The benchmarks closed at their lowest level in nearly two weeks on Tuesday after the Organization of the Petroleum Exporting Countries lowered its global oil demand growth forecasts for 2024 and 2025 amid demand concerns in China. OPEC cited weakness in China, India, and other regions for its decision, which marked the producer group’s fourth straight downward revision for 2024.

• FIXED INCOME & CURRENCY: The 10-year Treasury yield was little changed Wednesday as investors assessed a key inflation reading that came in as expected. The yield on the 10-year Treasury climbed less than 2 basis point to 4.451%. The 2-year Treasury yield fell about 7 basis points to 4.275%. One basis point is equal to 0.01%. Yields and prices move in opposite directions. Those moves come after the October consumer price index, which measures the cost of a basket of goods and services, showed an uptick in the annual inflation rate but nevertheless came in line with expectations. The reading increased 0.2% and 2.6% on a monthly and yearly basis, respectively. Core CPI, which excludes volatile food and energy prices, gained 0.3% for the month and was at 3.3% annually, also as expected. The tame inflation print puts the Federal Reserve on course to lower interest rates next month, with markets last pricing in a 79% likelihood of a quarter-percentage-point cut, according to the CME FedWatch Tool.

– The U.S. dollar advanced to one-year high against major currencies on Wednesday powered by so-called Trump trades and after U.S. inflation for October came in as expected, suggesting the Federal Reserve will continue lowering interest rates. The greenback hit its highest level since November 2023, buoyed by Donald Trump’s victory in last week’s U.S. presidential election, which sparked expectations of potentially inflationary tariffs and other measures by his incoming administration. Trump’s Republican Party will also control both houses of Congress when he takes office in January, Edison Research projected on Wednesday, enabling him to push an agenda of cutting taxes and shrinking the federal government. The dollar index , which measures the greenback against a basket of currencies including the yen and the euro, rose 0.43% to 106.44 after reaching as high as 106.53.

– The yen broke through 155 per dollar, the Japanese currency’s weakest level since late July. It was last at 155.46 yen per dollar. Japan’s wholesale inflation accelerated in October at the fastest annual pace in more than a year, complicating the Bank of Japan’s decision on how soon to raise interest rates.

– The euro was down 0.51% at $1.0569. It had dropped to as low as $1.055575, its lowest level since November 2023. The euro continued its descent amid expectations of potential Trump tariffs. Political uncertainty in Germany, the bloc’s biggest economy, has also weighed on the currency following the collapse of Chancellor Olaf Scholz’s governing coalition last week and with snap elections set for Feb. 23.

• INDONESIA: Continuing on his tour in America after his China visit, Prabowo has signalled he wants to have deeper diplomatic and business cooperation with the two major world powers. With the weakening optimism portrayed by the lowering Consumer Confidence Index, Car Sales, and Retail Sales numbers posted earlier this week, more FDI and Net Export is needed to boost economic strength and offset the waning household spending as we approach the dawn of 2025.

Company News

• SGER: Reveal 2 Million Metric Ton Coal Purchase, Potential Revenue IDR 3T
• PTRO: Prajogo’s Issuer Establishes Mining Services Business, Here’s the Purpose
• BOBA: Formosa Distributes Interim Dividend of IDR 2.31 Billion, Check the Schedule

Domestic & Global News
Sri Mulyani Worries that Indonesia Might Face Import Tariffs after Trump Wins US Presidential Election
Russia Stages First Missile Attack on Kyiv Since August, Ukraine Says

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