• The S&P 500 closed at a new all-time high of 4864.11 for the third consecutive session on Tuesday (23/01/23) on the back of a bullish view on the Technology sector. As for the NASDAQ itself, it led the gains of the major US indices by rising 0.4% to a record high, while the Dow Jones Industrial Average left the 38,000 mark again by
falling 0.3%. MSCI’s global equity index which tracks stocks in 49 countries edged up 0.14%, while the Japanese Yen weakened after the Bank of Japan did not change its monetary policy but signaled that the negative interest rate trend may be nearing its end. The Dollar Index rose to its highest level in 6 weeks, along with US Treasury yields that also rose as investors await the US GDP 4Q23 and US PCE (Dec.) data which is the Federal Reserve’s favorite inflation benchmark, to determine the direction of future interest rate trends. The benchmark 10-year US Treasury yield rose to 4.1378% compared to Monday’s close of 4.094%. The 2-year yield, which rose in line with traders’ expectations of higher for longer interest rates, touched 4.3784% compared to the US close of 4.376%.
• Speaking of interest rates, the European Central Bank (ECB) meeting on Thursday is expected to keep interest rates steady at current levels. This is in line with expectations for the Fed’s FOMC Meeting next week, where investors will be paying more attention to clues as to when the rate cut will happen. There is currently only about a 40% chance of a rate cut in March, compared to nearly 80% at the beginning of this month, as quoted from Investing.com’s Fed Rate Monitor Tool. S&P Global US Manufacturing & Services PMI data later tonight will also be taken into consideration.
• ASIA & EUROPE MARKETS: CHINA’S government announced to take stimulus measures to stabilize market confidence by mobilizing around 2 trillion Yuan (USD278.53 billion) into the stock market, as reported by Bloomberg News. Such good news immediately boosted the Hang Seng index – Hong Kong rebounded 2.6%, as did the Shanghai Composite index which rallied around 0.5% after both slumped in the previous session, with Shanghai even touching a 5-year low. This morning, Japan started the NIKKEI stock market on a lackluster note, with the announcement of very high Export growth plus a slowing negative Import pace, all expected to significantly reduce their Trade Balance deficit. In continental Europe, a number of PMI economic indicators from key countries such as GERMANY, EUROZONE, & UK will color the focus of attention of market participants today.
• COMMODITIES: OIL prices on Tuesday returned to negative territory amid sentiment of production disruptions in the US and conflicts in the Middle East and Europe; offset by rising crude supplies in Libya and Norway. Production at Libya’s Sharara oil field restarted earlier this week following the end of protests that halted
production since the beginning of this month, after the local government agreed to a number of demands. Meanwhile in the US, the state of North Dakota estimates that oil production in the region is down by around 250,000 to 300,000 barrels per day. Extreme cold weather also disrupted about 15% of production capacity on the Gulf Coast. Nevertheless, US crude oil (WTI) closed down 0.5% to USD74.37/barrel. Brent crude oil (Europe) also ended down 0.64% at USD79.55/barrel. On the other hand, GOLD prices in the spot market rose 0.33% to USD2,027.99/ounce, as investors await economic data and clarity on Fed policy.
• JCI: still wavering between the Support & Resistance areas of the Bearish Flag-like pattern, in which yesterday’s Closing position still holds above MA10 /7235 Support, but still has not managed to pass MA20/7260-7275. Thus, NHKSI RESEARCH still maintains the Hold/Wait & See Advise, before determining the next trading decision.
• BCAP: Expanding Financing Services
• DSSA: IDX Lifts Suspension on DSSA Shares
• SSIA: Unveiling Travelio’s IPO Plan
Domestic & Global News
• Bauxite Smelter is Stagnant, Here’s What Entrepreneurs Propose to Make Downstreaming Work
• China Weighs Stock Market Rescue Package Backed by USD 278 Billion
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