All three major US indexes posted gains in early week trading (17/04/23), helped by the financial & industrial sectors. At the same time, investors were somewhat restrained with a Wait & See stance, awaiting the release of issuers’ financial reports and several comments from Federal Reserve officials that could give more insight into the path of interest rates. NY Empire State Manufacturing Index (Apr.) looked firmly expansionary, justifying the need for the Fed to keep raising interest rates. US Treasury yields also crept up on expectations that the US central bank will still raise interest rates by 25 bps to the 5%-5.25% range at next month’s FOMC Meeting. Today the financial field will monitor a series of important economic data reports from China that will provide insight into the economic recovery process of the world’s second-largest country, such as: 1Q23 GDP and Industrial Production (Mar.), where economists expect China’s economic growth to rise to 4% YoY (the highest increase for almost a year). Meanwhile, from the UK, Average Earnings Index+Bonus, Claimant Count Change, and Labor Productivity (Q4) data will be the market’s concern today. China & the UK will also monitor their Unemployment Rate data. As for Germany and the Eurozone, market participants need to pay attention to the following data, which will be released this afternoon at 16.00 GMT: German ZEW Economic Conditions & Sentiment (Apr.), Euro Zone Trade Balance (Feb.) & ZEW Economic Sentiment (Apr.). Followed later in the evening by readings from the US: Building Permits & Housing Starts (Mar.).
JCI started the week with a lackluster start, retreating 30.99points / -0.45% to 6787.58; although foreigners still logged a net buy worth IDR 416.83 billion, increasing the monthly Foreign Net Buy to IDR 11.03 trillion. Positive sentiment from the Trade Balance (Mar.) reading was less expected as it turned out that the surplus fell to USD 2.91 billion, with Exports shrinking 11.33% YoY (the first decline in 29 months due to weak commodity prices and global demand). The same conditions also plagued Imports, which shrank by 6.26% YoY. Indonesia’s external debt position in February fell to USD 400.1 billion, from USD 404.6 billion in January. On the last day of trading this week, Indonesian investors will still be waiting for BI’s RDG decision regarding the benchmark interest rate, which expects BI7DRR to stay at 5.75%. Ahead of the long Eid holiday, NHKSI RESEARCH does not expect much movement in the market today. Slow & quiet trading pattern is predicted to be repeated, just to keep JCI moving between Support – Resistance range: 6760-6830; therefore it is reasonable if most investors/traders hold back and take a Hold / Wait & See position.
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