Today’s Outlook:
• Stocks on Wall Street rose and the Dow Jones Industrial Average recorded its second consecutive record closing high on Friday, with Tesla and Amazon surging after new US economic data raised expectations that the Federal Reserve will cut interest rates moderately in September. Friday ended a turbulent month on Wall Street after signs of a sudden moderation in the labor market in early August sparked fears of a US recession and briefly resulted in a sell-off. The effect of trading the Japanese Yen in order to close out carry-trade positions exacerbated the volatility. On Friday trading (30/08/24) the S&P 500 rose 1.01% to close at 5,648.40, the NASDAQ Composite advanced 1.13% to 17,713.62, while the Dow Jones Industrial Average appreciated 0.55% to 41,563.08. All 11 S&P 500 sector indices rose, led by consumer discretionary, surging 1.9%, followed by a 1.1% gain in the industrial sector. For the month of August, the S&P 500 skyrocketed 2.3%, the Dow jumped 1.8%, and the Nasdaq gained 0.6%.
• MARKET SENTIMENT: CORE PCE PRICE INDEX came in as expected at 0.2% mom and 2.6% yoy in July. CHICAGO PMI in Aug improved slightly although still in contraction territory. US CONSUMER SPENDING increased solidly in July, suggesting the economy remains strong while prices rose moderately. Important economic data this week includes the August employment report from the Labor Department, due on Friday. Money markets suggest most investors expect the Fed to cut interest rates by 25 basis points in September, with the possibility of a 50 basis point cut diminishing after Friday’s Private Output data, according to the CME FedWatch tool. However, current conditions are being interpreted as soft-landing symptoms. The ideal “Goldilocks” economy has steady growth, but not so much that it triggers excessive inflation.
• FIXED INCOME: The US 10-year bond yield, which moves opposite to prices, rose 4.2 basis points on Friday to 3.909%. The yield on the 2-year bond, which typically moves in tandem with interest rate expectations, rose 2.4 basis points to 3.9165%.
• ASIA & EUROPE MARKETS: CHINA reports Manufacturing PMI (Aug) which is again still below expansionary territory. EUROZONE CPI (Aug) released their preliminary estimate at 2.2%, easing from 2.6% in the previous month. towards the ECB’s 2% Target.
• A number of important economic data are highlighted today: au Jibun Bank Japan Manufacturing PMI (Aug) appears to be creeping higher approaching expansionary territory at 49.8. INDONESIA Nikkei Manufacturing PMI (Aug) fell back to 48.9 from 49.3, will certainly be the talk of the market today; in addition to August INFLATION which is predicted at 2.12% yoy. CHINA PMI is also in the spotlight as it is expected to enter the expansionary area of 50.0 from 49.8 previously. From EUROPE: GERMAN Retail Sales & Manufacturing PMI, ENGLAND Manufacturing PMI.
• JCI is still comfortable around the area of 7715 historical high, although closed slightly weaker at 7670.73, but still well above the first Support: MA10 / 7575. NHKSI RESEARCH sees bullish sentiment is still maintained especially due to consistent foreign buying interest & Rupiah exchange rate position which is still good around 15450/USD.
Company News
• HRTA: Hartadinata Sets Revenue Target of IDR 18T in 2024
• MYOH: Shrinks 34.78 Percent, MYOH June 2024 Profit Remains USD 5.4 Million
• ITMG: ITMG Interim Dividend Schedule IDR 1,228 per Sheet
Domestic & Global News
Protect Tobacco Industry, Economist Proposes Moderate and Multiyear Excise Increase
China, Philippines Accuse Each Other of Ramming Ships in South China Sea
Download full report HERE.
