Today’s Outlook:

• Wall Street’s three major stock indexes posted their highest closing records for the second consecutive day on Thursday (21/03/24) after the Federal Reserve reassured investors about the prospects of cutting interest rates this year, while shares of chipmakers rallied following an upbeat outlook from Micron Technology. The Dow Jones Industrial Average is one step away from the 40,000 level for the first time. As noted, the US central bankers kept the benchmark interest rate/borrowing costs unchanged and indicated that they still expect to cut rates by 75 bps by the end of 2024. Economists from Goldman Sachs predict that the US central bank will pivot in June, September, and December to complete the forecast of 3x rate cuts in 2024. Meanwhile, economic data released on Thursday morning added to investors’ bullish sentiment. The number of Americans filing new claims for unemployment benefits unexpectedly fell last week (actual: 210k vs. forecast of 212k), while Existing Home Sales in February increased by the most in a year (in fact jumped 9.5% well above the forecast of minus 1.3%), a sign that the economy remains on a strong footing in the first quarter. In terms of PMIs, the preliminary S&P Global US Composite PMI estimate for March is likely to come in at 52.2 (as projected), with manufacturing expanding and services contracting slightly. The data was echoed by the Philadelphia Fed Manufacturing index which showed an unexpected increase in March, underscoring the improvement in manufacturing activity. Later tonight market participants will await further comments from Federal Reserve Chairman Jerome Powell.
• ASIA MARKETS: Japan’s February inflation grew as expected to 2.8% yoy from 2.2% in the previous month; rising above the Bank of Japan’s annual target level and justifying the Japanese central bank’s recent policy move of raising interest rates for the first time in 17 years and ending the era of negative interest rates after 8 years. This morning’s Japanese Inflation data complements the au Jibun Bank Japan Services PMI which is firming in expansionary territory; whilst Japan’s Trade Balance for February posted a smaller than expected deficit on the back of higher than expected Export growth.
• EUROPEAN MARKETS: a number of PMI data also colored the European market, where the initial estimates of Manufacturing PMI (Mar.) Germany & Eurozone are still in contractionary territory, but the Services PMI is moving steadily in expansionary territory. The UK also reported similar PMI data, before the moment the Bank of England set their benchmark interest rate decision to remain at 5.25%. Ending this week, this afternoon will be awaited Retail Sales (Feb.) data from the UK, as well as the German Ifo Business Climate Index (Mar.) which will cover the evaluation and expectations of the business sector in Germany for the next 6 months.
• COMMODITIES: OIL prices closed lower on Thursday, as hopes of a ceasefire in Gaza and a stronger US Dollar weighed, although the prospect of limited global crude supplies could still support oil prices. Both benchmark oil prices fell by 0.3%, bringing US WTI to USD 81.07/barrel and Brent to USD 85.67/barrel. Reuters reported that the US will submit a draft UN resolution on Friday demanding an immediate ceasefire in Gaza lasting about six weeks.
• JCI agreed that 7400 level is the crucial Resistance to decide the continuation of this uptrend. The combination of regional market sentiment that continues to be green provides support for the bullish aura in the market, but on the other hand the uncertainty that still covers domestic sentiment regarding the 2024 Presidential Election results makes market participants somewhat restrained. NHKSI RESEARCH advises investors/traders to maintain a WAIT & SEE attitude for longer, especially at the end of this week. Foreigners were recorded as still diligently buying Indonesian stocks, as evidenced by the value of Foreign Net Buy yesterday collected IDR 556 billion. USD/IDR is quite stable at IDR 15,663/USD.

Company News
• ESSA: Share IDR86.1 Billion Dividend
• TPMA: Proposing Right Issue of 1.13 Billion Shares
• TPIA: Partnering with BCI Minerals

Domestic & Global News
• Red Carpet for Chinese Investors in the Pharmaceutical & Medical Device Sector in Indonesia
• Somali Pirates Return, Adding to Global Shipping Crisis

Download full report HERE.