US stock indexes bounced concurrently, with the Nasdaq leading the gains of more than 2%, as investors’ fears over the Silicon Valley Bank and Signature Bank were eased after US President Joe Biden and other global policymakers vowed the crisis would be contained. The banking and telecommunications services sectors led the S&P 500 to rebound from its biggest daily sell-off since June 2020. Positive sentiment was also driven by the US Inflation data (Feb.), which slipped to 0.4% MoM from 0.5% the previous month, reported by The Bureau of Labor Statistics. Even the annual CPI position managed to meet expectations at 6% YoY, from 6.4% in Jan. A slight concern came from the monthly Core Inflation figure, which still heated up slightly at 0.5% MoM, from 0.4% in Jan. Financial markets have now priced in a 74.5% likelihood that the US central bank will raise the interest rate by an additional 25 bps at next week’s FOMC Meeting; there is even a slight probability or 25.5% to be precise that the Federal Reserve may not even raise interest rates at all as reported by CME FedWatch.
In response to the global financial market situation, JCI failed to hold its support from the previous low of 6728 and returned to a 2-month low of 6641.81 on Tuesday trading (14/03/23); followed by IDR 1.33 trillion foreign selling. However, RSI has entered Oversold territory. Considering the sentiments rolling in the global capital market, NHKSI RESEARCH estimates that today the JCI will be able to make a (technical) rebound by at least testing Resistance back to 6700. The downtrend will still be tested until it at least closes above MA10 / 6786 (for now) and then tries to break above MA20 / 6820-6830. In a market that will be volatile for some time to come, a gradual buying strategy is the wisest thing to do.
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