Today’s Outlook:
• U.S. stocks closed slightly higher in languid trading on Wednesday (27/12/23), with little market-moving news to fuel conviction as the S&P 500 hovered just below bull market confirmation. The three major U.S. stock indexes oscillated between modest gains and losses throughout the session but finished up for the day (even the Dow Jones notched a new record closing high). All are on course for monthly, quarterly, and annual gains.
• The same positive sentiment of a rate cut expectation by the Federal Reserve as soon as March 2024 is still dominating the market, especially after the release of the US Personal Consumption Expenditures (PCE) price index data which is slipping, further supporting interest rate sensitive stocks and giving Wall Street an upward push. At last glance, financial markets have priced in a 73.9% probability that policymakers will reduce the Fed’s benchmark interest rate by 25 basis points at the March FOMC Meeting, according to CME’s FedWatch.
• COMMODITY: Oil prices dropped nearly 2% on Wednesday, eating into the previous day’s gains as investors monitored developments in the Red Sea, where shippers are returning despite further attacks on Tuesday. Brent crude futures settled down USD1.42, or 1.8%, at USD79.65 a barrel. U.S. West Texas Intermediate crude fell USD1.46, or 1.9%, to USD74.11. Both the Brent and WTI benchmarks settled more than 2% higher in the previous session as the latest attacks on ships in the Red Sea prompted fears of shipping disruption. Meanwhile, the prospect of a prolonged Israeli military campaign in Gaza remained a major driver of market sentiment. On the other hand, oil production at Russia’s Black Sea port Novorossiisk was also hampered due to storms. As for analysts, oil production in Russia (the world’s third largest oil producer after the USA & Saudi Arabia) is expected to stabilize or even increase next year as Russia has managed to overcome economic sanctions from Western countries.
• JCI created a Shooting Star-like candle as it posted a new Closing high at 7245.92; while RSI negative divergence was still lingering. NHKSI RESEARCH thinks that the JCI bullishness could still continue in this low sentiment market towards the end of the year. Low trading volume allows high volatility to occur, therefore keep your eyes open to anticipate potential window dressing that may occur in the remaining 2 trading days.
Company News
• INCO: Ford Injects IDR 88.71 Billion to INCO’s Entity Capital
• WSKT: Injecting Billions of Capital into Busines Entity
• OASA: Preparing IDR500 M CapEx Next Year
Domestic & Global News
• Ministry of Trade Waits for the Progress of TikTok Shop and Tokopedia System
• US-China Still Not Getting Along, Joe Biden Extends China Product Tariff Exclusions
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