Today’s Outlook:
• US Indices rose to new heights on Friday amid a shortened trading day that capped a strong month for equities. Some of the upward momentum came from chip stocks, which popped after Bloomberg reported that the Biden administration was considering additional barriers on the sale of semiconductor equipment to China that weren’t as strong as previously expected. A fairly broad advance propelled the S&P 500 into uncharted territory.
• ASIA MARKETS: Asia-Pacific markets mostly lost ground on Friday, led by losses in South Korean stocks after its industrial production declined for a second straight month in October. The country’s industrial production growth fell 0.3% last month compared to September when growth had also fallen by 0.3% month on month. Japan’s Nikkei 225 fell 0.37% after the inflation data release to end at 38,208.03, while the broad-based Topix fell 0.24% to 2,680.71.
– Tokyo’s core consumer price index, which excludes volatile fresh food costs, rose 2.2% year-on-year in November from a year earlier, up from 1.8% last month and beating forecasts for a 2.1% gain. The yen jumped to a six-week high against the dollar on Friday after faster-than-expected inflation in Tokyo supported bets for a Bank of Japan interest rate hike next month.
• CURRENCY & FIXED INCOME: The dollar was last down 1.2% at 149.68 yen, and earlier dipped to 149.53 yen for the first time since Oct. 21. It is set for a 2.1% weekly loss against the Japanese currency, the largest since September. The dollar index was last down 0.3% at 105.86, after earlier reaching 105.61, the lowest since Nov. 12. It is on track for a 2% rise in November as investors adjust for the likelihood that the new U.S. administration under Donald Trump next year will loosen business regulations and enact other policies that boost growth. The 10-year Treasury yield retreated to a new low going back to late October on Friday amid a shortened trading day for U.S. markets following the Thanksgiving holiday. The yield on the 10-year Treasury slipped nearly 5 basis points to 4.194%. At one point, the yield fell as far down as 4.184%, its lowest going back to Oct. 25. The 2-year Treasury shed around more than 3 basis points, sitting at 4.176%.
– The euro fell 0.1% to $1.0565. The single currency has tumbled about 3% in November as the dollar has rallied, putting it on course for its worst month since April 2022. Data on Friday showed that French consumer prices grew in line with expectations in November. Germany’s inflation report on Thursday showed price pressures remaining flat in November despite expectations of a second consecutive increase.
– European stocks closed higher Friday afternoon, following a mixed morning session as investors assessed the latest euro zone inflation data. The Stoxx 600 index closed up 0.58%, with almost all sectors and major bourses in the green. The pan-European benchmark also closed the month 0.96% higher, according to LSEG data. The gain was a recovery from October, when the index recorded the worst monthly performance for a year. Euro zone inflation rose from 2% in October to 2.3% in November, flash data from statistics agency Eurostat showed on Friday, above the European Central Bank’s 2% target.
– France’s CAC 40 index was little changed from the previous session amid ongoing political turmoil. It comes shortly after the country’s risk premium drew level with Greece’s for the first time. Separately, France’s harmonized inflation rate came in at 1.7% in November, up slightly from 1.6% in October, according to preliminary data from the National Institute of Statistics and Economic Studies (Insee).
• COMMODITIES: Oil prices fell on Friday, posting a weekly decline of 3%, pressured by easing concern over supply risks from the IsraelHezbollah conflict and the prospect of increased supply in 2025 even as OPEC+ is expected to extend output cuts. Trading activity was muted because of the U.S. public holiday. For the week, Brent fell nearly 3% while WTI lost 4.55%. The OPEC+ group comprising the Organization of the Petroleum Exporting Countries and allies including Russia delayed its next policy meeting to Dec. 5 from Dec. 1. OPEC+ is expected to decide on a further extension to production cuts at the meeting.
– Gold prices gained on Friday, boosted by a drop in dollar and persistent geopolitical tensions, but bullion was still set for its worst monthly loss since September last year after a post-election sell-off driven by Donald Trump’s win. Spot gold rose 0.7% to $2,660.28 per ounce, but was set for a weekly fall of over 2% after a sharp decline earlier this week. U.S. gold futures also gained 0.7% to $2,684.9. Gold, buoyed by geopolitical tensions and Federal Reserve interest rate cuts this year, now faces pressure as higher tariffs could stoke inflation and lead the Fed to adopt a cautious approach to further rate cuts.
• JCI continued to spiral down by -85.68/ -1.19% to 7,114 breaking down the dynamic support of MA10 at 7,193. NHKSI RESEARCH thinks JCI still needs to find a solid ground to rebound and start the window dressing journey into the last month of 2024. Investors/traders are advised to shift to BUY ON WEAKNESS for stocks that have been in the Support area early this week. Please keep in mind that foreign appetite has yet to reappear in our market as on Friday they were still consistently net selling IDR 1.60 trillion (RG market). RUPIAH exchange rate is entrenched at 15,851/USD, there are hopes of “strengthening” Rupiah towards 15,600 – 15,500 at the end of this year based on the plan to cut FFR at the FOMC MEETING on 17-18 December.
Company News
• MDKA: Merdeka Copper Gold (MDKA) Offers IDR 1T Bonds
• HITS: Shrinks 29 Percent, HITS Profit in Third Quarter 2024 Remains USD7.89 Million
• BRMS: Revenue Up 231%, BRMS 3Q24 Recorded a Deficit of USD769 Million
Domestic & Global News
Indonesia National Energy Council: Bioethanol is a surefire way to reduce fuel imports
Stimulus Impact Starts to Show, China Manufacturing PMI Index Continues Recovery
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