All three major US stock indexes slipped back into negative territory for the third consecutive day, with Nasdaq leading the way down 1.2%, after Federal Reserve Chairman Jerome Powell calling for a further two rate hikes this year to push US inflation to the 2% target. These hawkish comments sent Tech stocks into the red, with the Philadelphia SE Semiconductor Index dropping 2.7%; as market participants priced in a 74.4% probability of a 25 bps rate hike at the upcoming FOMC Meeting in July, as reported by CME Group FedWatch. On the other hand, the Energy sector managed to rebound from its biggest monthly decline. From the Europe, the Bank of England has so far failed to control UK Inflation as the May CPI rate was released unchanged at 8.7% YoY, which failed to meet expectations of a drop to 8.4% YoY. No wonder that the Bank of England will be in the spotlight today regarding the benchmark interest rate decision which is allegedly going to rise 25 bps to 4.75%. Not only¬† the UK, today’s Bank Indonesia Board of Governors Meeting will also re-determine the BI7DRR rate which is predicted to remain at 5.75%. Meanwhile, US investors will still closely monitor Jerome Powell’s second comments before the US Senate Banking Committee later tonight at around 21:00 WIB, before being preceded by the release of weekly Initial Jobless Claims and Existing Home Sales (May) data.

The JCI was finally able to bounce back to positive territory on Wednesday trading (21/06/23) although it was still followed by foreign net sell of IDR 61.93 billion, bringing the total Foreign Net Sell over the past week to almost IDR 2 trillion (all markets). Considering the current position of JCI which has perched back above MA10 & MA20, NHKSI RESEARCH considers that further bullish potential is possible towards the critical Resistance level around 6745-6765. Indonesian investors/traders are advised to average up gradually.

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