Today’s Outlook:
• Before US markets close for the Thanksgiving holiday, European stocks edged up on Thursday trading after falling the previous day, while Asian stocks slumped, as trading volumes thinned ahead of the US Thanksgiving holiday. The US market will reopen for half a day this Friday until 13:00 local time. The STOXX 600 index across continental Europe rose 0.48%, after falling 0.75% in the previous two sessions. MSCI’s index of Asia Pacific shares excluding Japan fell 0.52%, but Japan’s Nikkei rose 0.56%. Although US equity and bond trading was closed, futures for the US S&P 500 rose 0.24% after the index fell 0.38% on Wednesday. European markets were boosted by a rally in Technology stocks after Bloomberg reported the Biden administration’s restrictions on Chinese chips may not be as severe as expected. Central banks across Asia-Pacific still expect the FOMC to cut interest rates by 25 basis points at its December meeting. The preliminary GERMAN CPI estimate came in 0.1% lower than expected, coming in at 2.2% yoy for Nov, compared to 2.0% in Oct. This afternoon it’s the EUROZONE’s turn to face their Inflation figures (Nov) which are expected to again accelerate above the ECB Target of 2%. A number of other economic indicators from GERMANY, such as Retail Sales (Oct) and Unemployment Rate (Nov) will also give color to the market dynamics.
• ASIA MARKETS: In a surprise move, SOUTH KOREA’s central bank cut its benchmark interest rate for the second consecutive meeting on Thursday after inflation slowed more than policymakers expected. The Korean WON weakened after the decision.
– JAPAN released Tokyo Core CPI figures this morning, which apparently heated up above the 2.0% forecast, coming in at 2.2% yoy in Nov; possibly supported by Industrial Production which started picking-up 3.0% mom in Oct, from 1.6% the previous month.
• CURRENCY & FIXED INCOME: The DOLLAR INDEX, which measures the strength of the US currency against 6 of its rivals, rose 0.1% to 106.2 after falling 0.7% in the previous session. Market analysts expect Wednesday’s fall in the dollar to likely be driven by investors cashing in profits from US stocks and bonds before the month of November ends.
– The Japanese YEN was 0.28% weaker at 151.52/USD after rallying to a 1-month high in the previous session. The Asian currency headed for its strongest week since early September on rising expectations of a rate hike from the BANK OF JAPAN next month.
– EURO was down 0.13% at USD 1.0552 after rising 0.7% in the previous session following EUROPEAN CENTRAL BANK (ECB) board member Isabel Schnabel’s statement that rate cuts should be gradual and move into neutral territory.
– EUROPEAN BOND YIELD fell as prices rose, a bit of relief for the French government, which saw its borrowing costs rise to the highest level over Germany’s since 2012 on Wednesday.
• COMMODITIES: OIL prices rose after ISRAEL said the ceasefire with HIZBULLAH had been violated when they suspected several vehicles were sneaking in from the south; automatically pushing BRENT crude oil up 0.37% to USD 73.1/barrel. OPEC+ is suspected to postpone the meeting originally scheduled for Sunday, to December 5, with the agenda of cutting oil production. The group will discuss whether to go ahead with plans to increase production by 180,000 barrels per day starting in January. Reports indicate that discussions are underway to delay the planned increase, possibly for the next few months.
– On the other hand, spot GOLD prices rallied 0.14% to USD 2,639/ounce, on a downward trajectory of nearly 4% during November, its weakest monthly performance in over a year.
• JCI plunged another 45.73pts / -0.63% to 7200.16 level, holding on tightly to the last MA10 Support a day after the first nationwide election held in Indonesia. Market sentiment was more or less hurt by the decline of big caps ADRO and a handful of peers which shaped market interest to be more bearish. NHKSI RESEARCH thinks JCI still needs to find a solid ground to rebound and start the window dressing journey into the last month of 2024. Investors/traders are advised to maintain a WAIT & SEE attitude at the end of this week and pay attention to market interest early next week before starting to BUY ON WEAKNESS stocks that have been in the Support area. Please keep in mind that foreign appetite has yet to reappear in our market as yesterday they were still consistently net selling IDR 702 billion (RG market). RUPIAH exchange rate is entrenched at 15,865/USD, there are hopes of “strengthening” Rupiah towards 15,600 – 15,500 at the end of this year based on the plan to cut FFR at the FOMC MEETING on 17-18 December.
Company News
• FILM: Strengthen Capital, FILM Proposes Right Issue License 989.77 Million Sheets
• AMMN: Amman Mineral Revises Copper & Gold Production Guidance for the End of 2024
• UNTR: UNTR Heavy Equipment Sold 3,764 Units as of October 2024
Domestic & Global News
Maruarar: 7 Conglomerates Participate in the 3 Million Houses Project
China’s Industrial Profits Continue Weakening as of October 2024, Stimulus Not Yet Effective
Download full report HERE.
