Today’s Outlook:

• NASDAQ closed at a record high on Monday (20/05/24) and GOLD surged to an all-time high as investors weighed hawkish comments from Federal Reserve officials regarding the handling of US Inflation. Although the DJIA left the psychological 40,000 level, the tech-heavy Nasdaq led WallStreet gains by rising 0.65% driven by the chip sector, as Nvidia gained ahead of its earnings release on Wednesday which is closely watched by market participants. Fed officials’ comments still reflected the US central bank’s cautious view on their progress in controlling inflation, as well as the timing of interest rate cuts. Fed Vice Chairman Philip Jefferson said it was too early to tell whether the slowdown in inflation would last, while Fed Vice Chairman Michael Barr said tight monetary policy should be in place for longer. Atlanta Fed President Raphael Bostic said the central bank still needs more time to be convinced that price growth is on the expected downward trajectory. More comments are coming from Fed officials today, while US TREASURY yields edged higher after Fed officials expressed uncertainty about the timing of a rate cut. The 10-year bond ended down 32/7 leaving the yield at 4.4453%, from 4.42% at the end of Friday. Meanwhile, the 30-year bond ended lower at 32/11 making the yield at 4.5816%, from 4.561% at the end of last Friday. The US DOLLAR posted slight gains against a number of world currencies as investors await further clues on the path of interest rates. The DOLLAR INDEX (DXY) rose 0.15%, and the Euro fell 0.11% to USD 1.0858/Eur. The Japanese Yen weakened 0.39% against the greenback at 156.30/USD, while the PoundSterling last traded at USD 1.2702, up 0.02%.
• EUROPEAN & ASIAN MARKETS: European stocks advanced slightly, held back by interest rate uncertainty. The pan-European STOXX 600 index rose 0.18% and MSCI’s worldwide stock index rose 0.11%. Emerging market stocks gained 0.16%. MSCI’s index of Asia Pacific shares outside Japan closed up 0.19%, while Japan’s Nikkei rose 0.73%. CHINA set its interest rates to remain unchanged as expected. This morning JAPAN reported the Tertiary Industry Index which measures the change in the total value of services purchased by businesses, increased significantly to its highest level since at least August 2023; indicating meaningful economic health. Today will see GERMAN PPI (Apr.) and EUROZONE Trade Balance data.
• COMMODITIES: Crude OIL prices stabilized as traders digested the Fed’s hawkish comments against signs that Inflation is starting to ease. US WTI crude fell 0.32% to USD 79.80/barrel, while BRENT settled at USD 83.71/barrel, down 0.32% on Monday’s trade. The Oil market seemed less affected by political uncertainty in the world’s two major oil producing countries after Iranian President Ebrahim Raisi was killed in a helicopter crash and Saudi Arabia’s crown prince postponed a trip to Japan due to the health of his father, the king. Iran’s oil policy should not be affected by the president’s sudden death as Supreme Leader Ayatollah Ali Khamenei holds the ultimate power to decide all state affairs. In Saudi Arabia, the market is accustomed to Crown Prince Mohammed Bin Salman’s leadership in the energy sector so the sustainability of Saudi Arabia’s strategy is expected to be undisturbed by the king’s health issues. In other commodities, GOLD hit record highs, following last week’s encouraging Inflation data plus the latest speculation regarding the death of Iran’s President in a helicopter crash; while SILVER hit its highest level in over 11 years. Gold prices on the spot market closed up 0.4% to USD 2,424.69/ounce. COPPER, a barometer of economic sentiment, surged to a record high after China announced measures to shore up its crisis-hit property sector. Copper rose 2.97% to USD 10,985.00/ton.
• INDONESIA posted a Balance of Payment deficit of USD 6 billion in the first quarter of 2024, reversing direction from the 4/2023 quarter surplus of IDR 8.6 billion. Going forward, Bank Indonesia continues to pay close attention to the dynamics of the global economy that could affect the outlook for the Balance of Payments, in addition to continuing to strengthen the policy mix in close synergy with the government and related authorities, in order to strengthen the resilience of the external sector. BI expects the 2024 balance of payments to be maintained with the current account in a low deficit range of 0.1% to 0.9% of GDP. The capital and financial account balance is predicted to record a surplus, in line with the forecasted increase in foreign capital inflows as global financial market uncertainty eases, as well as the maintenance of positive investor perceptions of the national economic outlook and attractive investment returns.
• JCI is on its way to the 7450 TARGET, all time high level, seems to have to pullback first to test the MA50 Support resistance around 7240 or maybe MA10 & MA20 (which have goldencrossed thereby providing a platform for an uptrend) around 7170- 7180. NHKSI RESEARCH advises investors/traders to use the momentum as an opportunity to BUY ON WEAKNESS.

Company News

• TRIN: IDR21.16 Billion Loss as of March 31, 2024
• AKRA: Arthakencana Collects 24.73 Million AKRA Shares
• AMAR: IDR48 Billion Profit

Domestic & Global News
• Social Aid Showers 2025′, Prabowo’s First Year Budget Reaches IDR 513 Trillion
• China Bans US Companies from Export-Import Activities in Retaliation for Tariff Hikes

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