Today’s Outlook:
• The S&P 500 and other indexes closed in positive territory on Friday (16/08/24), recording its best week of the year as easing fears of an economic recession fueled stock buying after recent market turmoil. The Dow Jones Industrial Average rose 96 points, or 0.1%, the S&P 500 gained 0.2%, and the NASDAQ Composite appreciated 0.2%. Upbeat economic data continued to emerge ahead of the Federal Reserve’s annual Jackson Hole meeting. Survey data from the UNIVERSITY OF MICHIGAN released on Friday showed that consumer sentiment recovered in August for the first time since May, boosted by developments in the US presidential election, which further eased concerns about the economy. Consumer expectations about inflation over the next 1 year and 5 to 10 years were also unchanged, at 2.9% and 3% respectively, reinforcing expectations that the Fed’s policies are working, just as focus turns to Fed Chairman Jerome Powell’s speech next week in JACKSON HOLE, Wyoming. UBS economists expect Fed Chairman Jerome Powell to outline the rationale for monetary policy easing more clearly in a speech at Jackson Hole on Friday August 23, by which they mean an affirmation of a 25 basis point rate cut, rather than 50 basis points. Fund managers are also fairly confident the US will not go into recession, but markets are likely to be more volatile until later this year, especially around the US presidential election in November. The US 10-year bond yield fell 4 basis points to 3.883%.
• U.S. POLITICAL MAP: US Presidential candidate KAMALA HARRIS on Friday outlined her economic agenda focusing on tax cuts, affordable housing and lower food prices, which the Democratic presidential candidate believes will create opportunities for the middle class. The speech comes ahead of the Democratic National Convention on August 19-21, when Harris has the opportunity to build on her momentum by introducing herself and expanding on her policies to win over uncommitted voters. Harris now has a 2.8-point lead over Trump in the latest average of national polls compiled by FiveThirtyEight.
• ASIA & EUROPE MARKETS: JAPAN’S NIKKEI Index surged 3.6% on Friday and recorded its best week in over 4 years, while HONG KONG’s HANG SENG Index rose 1.9%. Japanese stocks experienced significant gains after suffering heavy losses last week following the Bank of Japan’s surprise interest rate cut sent the Yen soaring against the US Dollar, leading many traders/investors to liquidate their Yen carry trade positions. The Dollar fell against the Yen on Friday, and weakened against other major currencies after the release of disappointing US housing figures. US single-family home construction fell in July as higher mortgage rates and home prices discouraged buyers, suggesting the property market remained depressed at the start of the third quarter. The Euro rose 0.47% against the Dollar. Happy Retail Sales conditions also prevailed in the UK where their Retail Sales (Jul) rose in line with expectations.
• COMMODITIES: OIL prices fell almost 2%, with global benchmark BRENT crude, hovering below USD 80/barrel, but little changed in the week as investors reduced expectations of demand growth from the largest oil importer, China. Brent fell 1.7%, to settle at USD 79.68/barrel and US WTI crude fell 1.9%, to USD 76.65. GOLD spot prices surged to an all-time high, up more than 2% at USD 2507.28/ounce currently.
• JCI: closed higher by 22.59pts / +0.30% to 7432.09, recording a weekly gain of 2.41% supported by Foreign Net Guy of IDR 2.63 trillion (all market). JCI seemed stuck around the all-time-high level of 7455-7460, overlaid by RSI negative divergence (= meaning buying momentum was detected weakening when JCI was in this critical Resistance region). Although the market sentiment in general is quite bullish, NHKSI RESEARCH advises investors/traders not to forget to set TRAILING STOP levels in anticipation of any pullback movement that may occur when the nervous market is unable to go higher than this all-time high.
Company News
• MAIN: Soaring 323%, MAIN Earns IDR 292 Billion in the First Semester of 2024
• APLN: Moody’s Raises Rating, Here’s APLN Management’s Response
• MYOR: Mayora Indah’s Strategy to Deal with the Rise in Global Cocoa Prices
Domestic & Global News
Investor Interest in IKN is Low, Ministry of Finance Alludes to State Budget Balance
Russia Denies Report About Indirect Talks With Ukraine
Download full report HERE.
