Today’s Outlook:
• The Dow and Nasdaq clinched record closes Friday (15/12/23), amid optimism for rate cuts next year even as a warning from a Fed official attempted to warn regarding the possibility of tight monetary policy next year. The Dow Jones Industrial Average rose 0.1% to a record close for third straight session. The S&P 500 index closed 0.1% lower, but notched its seventh-straight weekly win.
• New York Fed President John Williams told CNBC in an interview Friday that talk of rate cuts is still “premature” and the central bank could still tighten policy if needed. The New Fed president’s remarks rein in some of the aggressive bets on rate cuts markets are expecting for next year, boosting Treasury yields. The yield on the 2-year Treasury, which is sensitive to Fed policy decision, rose 5 basis points to 4.451%, while the U.S. 10-year yield fell 2 bps to 3.915%.
• On the PMI economic front, US manufacturing activity fell more than expected in December, but services activity, which makes up the bulk of the inflation, increased by more than expected. Earlier on Friday, a survey showed domestic business activity picked up in December amid rising orders and demand for workers, which could further help to allay fears of a sharp slowdown in economic growth in the fourth quarter.
• Oil prices settled lower Friday, but still notched their first weekly gain in two months as the expectations of U.S. rate cuts next year boosting the economy and crude demand forced the bears to loosen their grip. The U.S. crude futures settled 0.2% lower at USD71.43 a barrel and the Brent contract rose 0.2% to USD76.75 a barrel. Dovish signals from the Fed have been a key support for commodity markets including energy this week, as the central bank signaled deeper-than-expected rate cuts in 2024.
• China, the largest importer of crude, continues to face a bumpy economic recovery as data showed consumer and investment spending increased at slower than expected pace. The ongoing struggles have fueled concerns that Beijing have to roll out further stimulus to keep its economic recovery on track.
• The International Energy Agency helped the market earlier this week by slightly lifting its oil demand forecast for 2024. But the IEA’s forecast for demand was still much lower than that suggested by the OPEC+. Underwhelming production cuts from the cartel group were a key weight on oil in recent weeks, driving prices to over five-month lows. Even with a positive demand outlook for 2024, crude markets are still expected to remain well supplied. This was also in part due to strong U.S. production, with recent data showing that total U.S. output remained close to record highs in the past week. U.S. inventories saw a bigger -than-expected drawdown, although fuel demand in the country remained weak, with gasoline inventories seeing a mild build.
• JCI made another closing position at the latest high this year, where the 7200 level is still a crucial Resistance. Considering this position, NHKSI RESEARCH believes that investors/traders can still let their profits run (while still applying Trailing Stop level amidst the warning of RSI negative divergence), as well as watching the market sentiment from time to time to assess the opportunity of Santa Claus Rally or window dressing.

Company News
• JSMR : Injecting IDR2.7 Trillion into JKC’s Capital
• CUAN : Acquires Three Mining Businesses
• CTRA : Buy Subsidiary Shares

Domestic & Global News
• Kadin Reveals 3 Potential Business Opportunities After COP28 Commitment
• Geopolitics Heats Up, China Starts Banning Its Citizens from Using Apple

Download full report HERE.