Today’s Outlook:

• Global stock markets moved lower on Wednesday (23/10/24) amid sluggish trading ahead of the US ELECTION, while Gold prices fell from record highs, dragged down by a rising US Dollar. Investors are also digesting how much the Federal Reserve may need to cut interest rates after the latest US economic data showed a steadily expanding and job-creating economy. The latest market conditions forecast a 92% chance of a 25 basis point cut at the Fed’s next meeting in November and another 25 basis point cut by the end of the year. A month ago, traders expected a cut of up to 1% in January. The yield on the benchmark 10-year US Treasury note hit a 3-month high and was last up 3.2 basis points at 4.238%. On Wall Street, all three major indices closed in negative territory, triggered by losses in Consumer discretionary, Technology, and Communication Services stocks. Real Estate and Utilities were the sectors that gained the most. The Dow Jones Industrial Average fell 0.96% to 42,514.95, the S&P 500 lost 0.92% to 5,797.42, and the Nasdaq Composite plunged 1.60% to 18,276.65. The MSCI All-World Index dropped 0.79%, while in Europe, the STOXX 600 closed down 0.30%.

• US ELECTIONS: Republican candidate Donald Trump’s odds of beating Democratic candidate Kamala Harris have recently increased on betting websites, although polls show the race to the White House is still too tight to predict. The prospect of another Trump presidency has become a focus for investors, as his policies include tariffs and restrictions on illegal immigration, among other measures, which are expected to drive inflation.

• THE US PRESIDENTIAL ELECTION EFFECT: Market analysts predict that the sectors that will benefit if TRUMP is elected are: Industrials, Financials, small caps, emerging-markets, and China stocks, as they were the ones that performed well when Trump became president in 2016-2020; while the Energy sector underperformed. EVERCORE ISI analysts are also forecasting how the market will react to the potential outcome of a HARRIS presidency, which could potentially favor stocks related to clean energy and Healthcare related sectors.

• COMMODITIES: GOLD prices fell after hitting a record high amid a rising US Dollar. Demand for gold as a safe haven asset was partly driven by US election fears and geopolitical tensions in the Middle East and Europe. Gold bullion, which has gained 33% this year, was last down 1.19% at USD 2,715.62/ounce. Gold hit a record high of USD 2,758.37 earlier in the session. Meanwhile, OIL prices fell after data showed US crude inventories rose more than expected even as refining activity recovered. BRENT crude oil prices closed at USD 74.96/barrel, down 1.42%. US WTI crude oil prices closed down 1.35% at USD 70.77.

• MIDDLE EAST CONFLICT: US Secretary of State Antony Blinken on Wednesday urged a halt to fighting between Israel and militant groups Hamas and Hezbollah, as Israel launched a major airstrike on the Lebanese port city of Tyre. Market participants expect the Middle East conflict to last longer, with a ceasefire deal potentially deadlocked.

• CURRENCY: The DOLLAR INDEX, which measures the greenback’s strength against a basket of currencies including the Yen and Euro, rose 0.26% to 104.37, to its highest level since July. Against the Japanese Yen, the Dollar strengthened 1% to 152.57. The euro fell 0.11% to USD 1.0785. Goldman Sachs said in a note on Tuesday that the Euro could fall as much as 10% in a scenario where a Trump presidency ushers in tariffs and large tax cuts.

• ASIA & EUROPE MARKETS: South Korea this morning reported their preliminary 3Q GDP estimate which came in at 1.5% yoy, lower than the 2.0% forecast and also the previous quarter’s 2.3%. Economic weakness was also seen in JAPAN when they released the au Jibun Bank Japan Manufacturing & Services PMI (Oct) this morning which slipped further into contraction territory (below 50). Later in the day, it’s the turn of the GERMAN & EUROZONE PMI which will be in the spotlight for market participants, as well as the UK. Later in the evening, the US will announce the S&P Global PMI figures, as well as the weekly Initial Jobless Claims which this time predicts 243k jobless claims, up 2k from the previous week’s 241k.

• JCI : has been trying to break the critical level of 7800 for several days now which has the potential to catapult JCI to the AllTime-High level of 7900 or even 8000 as NHKSI RESEARCH Year-End Target. We think the market is waiting for the right momentum in the next month (due to FOMC MEETING & US Election issues) to more freely continue this bullish swing, while waiting for foreign inflow back into Indonesian equity market. Meanwhile, use sector rotation wisely to sort out trading opportunities. Do not forget to monitor the nearest Support area at 7720 in case of any pullback movement.

Company News

• PTRO: Prajogo’s Issuer Reveals Business Potential of Synergy with CUAN
• BBCA: Revealed Profit Up 12.8 Percent Driven by All Segments in Third Quarter
• UNVR: Plummeted 28 Percent, UNVR Profit in 3Q24 Remains IDR 3 Trillion

Domestic & Global News
Hashim Reveals Indonesia Will Get IDR 400 Trillion, Where Will It Come From?
US Says Evidence Shows North Korea Has Troops in Russia, Possibly for Ukraine War

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