Today’s Outlook:

• US stocks closed higher on Friday, the S&P 500 and Nasdaq recorded their biggest weekly percentage gains since early November 2023 on the back of a rally in giant stocks following strong quarterly earnings results from major Tech companies Alphabet, Microsoft, Amazon, and Nvidia; alongside moderate Inflation data. The S&P 500 and NASDAQ recorded their largest weekly percentage gains since early November 2023. The S&P 500 index ended a three-week slide, while the Nasdaq ended a four-week losing streak. US Commerce Department data showed benchmark Inflation rose moderately in March on an annualized basis while being in line with estimates on a monthly basis. The report provided some relief to financial markets gripped by stagflation fears a day after data showed inflation surged but economic growth slowed in the first quarter. The PERSONAL CONSUMPTION EXPENDITURES (PCE) PRICE INDEX rose 0.3% in March, in line with forecasts by economists polled by Reuters. In the 12 months to March, PCE Inflation rose 2.7% versus expectations of 2.6%. Following the data, money markets priced in a possible Federal Reserve rate cut in September. The 10-year US TREASURY YIELD fell after the data, last at 4.6630% from 4.706% at the end of Thursday. The 2-year yield, which typically moves in line with interest rate expectations, fell 0.5 basis points to 4.9934%, from 4.998%. Overall, world equity markets are set to end the month lower, as hopes of a Fed rate cut in the near future have receded following a string of strong US economic data readings. US Treasury Secretary JANET YELLEN told Reuters on Thursday that currency intervention was acceptable only in “rare” situations and that market forces should determine the exchange rate. Yellen also said that US economic growth was likely stronger than predicted by weaker-than-expected first quarter production data.
• ASIA & EUROPE MARKETS: while the JAPANESE YEN slumped to a 34-year low after the Bank of Japan (BOJ) maintained loose monetary policy. The dollar reached 158.275 yen, the highest since June 1990. The Bank of Japan kept interest rates at around zero at its policy meeting, despite forecasting inflation of around 2% over three years. Market participants are waiting for the Japanese authorities to prop up the currency, in an unconventional and politically difficult decision. BOJ Governor Kazuo Ueda said on Friday that exchange rate volatility could significantly impact the economy. MSCI’s index of worldwide stocks also rose 0.90%; the benchmark EUROPEAN stock index recorded its biggest daily gain in more than three months, closing up 1.2%, driven by gains in banking and industrial stocks. Today comes the preliminary German CPI (Apr.) estimate at 2.3% yoy, up moderately from March’s 2.2%.
• COMMODITIES: OIL prices ended in positive territory on Friday, snapping a 2-week losing streak after shrugging off Dollar strength following Inflation data that was in-line with expectations, amid continued geopolitical tensions. BRENT futures contract prices rose 0.3% to USD 89.85/barrel, while US WTI gained 0.4% to USD 89.38/barrel. Oil prices rose in recent sessions as data showed US inventory stocks shrank more than expected in the past week, indicating a tightening global oil market. Concerns over Middle East supply disruptions also emerged as Israel stepped up its attacks on Gaza. Although a direct war with Iran did not materialize, the Israel-Hamas conflict shows no signs of ending soon. The US is also planning to mobilize more military aid to Israel after President Joe Biden approved a bill to that effect earlier this week. Due to the lack of escalation in the Israel – Iran War oil prices are trading well below the 5-month highs reached in early April, although some elements of the risk premium will continue to influence oil prices, helping to support the benchmark oil price against fears of weakening global demand.
• Today INDONESIA investors will be looking forward to Foreign Direct Investment data which growth will be compared to the last position of 5.3%. JCI closed at 7036, down 1.67% on Friday testing the critical Support level at 7030, which if a technical rebound does not materialize soon, it is not impossible to lead JCI to test Support to the psychological level of 7000. NHKSI RESEARCH advises investors/traders to hold back (WAIT & SEE) waiting for JCI to confirm a solid Support area.

Company News

• SIDO: Profit and Revenue Increase in 1Q24
• BBTN: Loans Reach IDR344.2 T in 1Q24
• HMSP: Wrap Up IDR2.24 T Net Profit

Domestic & Global News
• ESDM Foresees the B35 Program Incentive in 2024 to be Higher than Last Year
• Elon Musk Visits China as Tesla Seeks Self-Driving Technology Rollout

Download full report HERE.