• MSCI’s global equities index fell more than 1% on Wednesday after nine straight days of gains while Treasury yields fell as U.S. economic data beat expectations and UK inflation slowed at a rate that took markets by surprise. Wednesday’s decline snapped a nine-session winning streak for the index. On Wall Street, the Nasdaq Composite led the decline by 1.5% to 14,777.94.
• US 10-year Treasury yields fell to an almost five-month low as government bond yields fell globally after the British inflation data. Benchmark 10-year notes were down 6.7 basis points to 3.855%, from 3.922% late on Tuesday. The 30-year bond was last down 4.7 basis points to yield 3.9889%, from 4.036%. The 2-year note was last was down 9.5 basis points to yield 4.3418%, from 4.437%.
• US existing home sales rose unexpectedly in November. And, amid optimism about the labor market, the Conference Board said its consumer confidence index increased to 110.7 this month comparing well to economist expectations for 104.0 and November’s downwardly revised 101.0. Investors at first reacted positively to the data but the S&P 500 lost steam in afternoon trading, ending the session down 1.5% after coming within 0.4% of its record high reached in January 2022.
• Oil prices settled slightly higher after hitting their highest level in nearly three weeks, as traders dealt with worries about disruptions in the Red Sea after Yemen’s Iran-aligned Houthi militants stepped up attacks on commercial ships. Global oil benchmark Brent hovered above USD80 a barrel. US crude/WTI settled up 0.38% at USD74.22 per barrel and Brent settled at USD79.70, up 0.59% on the day. In precious metals, spot gold dropped 0.4% to USD2,031.61 an ounce.
• The dollar rose against other major currencies, while sterling fell sharply after UK inflation plunged in November to its lowest rate in more than two years at 3.9%. That was far lower than the 4.4% economists polled by Reuters had expected, making it less of an outlier globally. The dollar strengthened against sterling after the UK inflation data fueled speculation of rate cuts by the Bank of England.
• JCI continued its climb yesterday, closing above the crucial Resistance level of 7200 as Asian markets rejoiced after Bank of Japan maintained its dovish stance, while PBOC also did not change their benchmark interest rate, as expected. Foreigners booked another net buy of IDR 624.8 billion, bringing the YTD Foreign Net Buy position to IDR 4.92 trillion.
• Later in the afternoon, BI’s RDG decision on interest rates will be monitored, which is expected to remain unchanged at 6.0%. NHKSI RESEARCH believes that bullish sentiment due to the dovish interest rate outlook and pivot view next year will still be a positive catalyst for the market until the end of the year, thus advising investors to continue to take advantage of the Santa Claus Rally and potential window dressing to let your profits run, while still not forgetting to set Trailing Stop points in the market that continues to reach new highs.
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