Wall Street stocks managed to reverse losses to end positive on Thursday. US Treasury yields tempered gains as investors digested strong economic data and signals of a measured interest rate approach from the Federal Reserve. US Initial Jobless Claims numbers were released at 190K, lower than the expected 195K (also lower than the previous week at 192K). At the same time, 4Q22 Unit Labor Costs rose significantly to 3.2% (2x higher than the 1.6% forecast and 2% from the previous quarter.) These two economic data explain how solid the labour market is, where the jobless rate continues to fall, and workers’ wages continue to rise. On the other hand, Atlanta Fed President Raphael Bostic said that the 25 bps rate hike is still applicable to limit the risk of recessionary pressures on the economy. From Europe, Eurozone annual inflation (Feb.) remained unchanged at 8.5% YoY, failing to meet expectations of an increase to 8.2%, although slightly easing from January’s 8.6%. On a monthly basis, Eurozone CPI actually strengthened by 0.8% compared to the previous month -0.2%. Meanwhile, the increase in Core Inflation to 5.6% (vs forecast & previous: 5.3%) further strengthened the view that the Eurozone Inflation rate is still difficult to tame.

JCI continued to rally for the second day, although the closing position of 6857 was not exactly in line with the first resistance, which is MA10. Market sentiment was more influenced by issuers’ financial reports that have been released recently. Bank Indonesia has begun to implement the deposition of Foreign Exchange Export Proceeds for a certain period in domestic banks, as well as providing attractive interest rate incentives to exporters according to the length of the deposit period which varies between one, two, or three months. Considering the overall market condition, NHKSI RESEARCH still sees potential for Consolidation – Sideways on JCI at the end of this week, although a close above MA20/6880-6890 would be preferred as it would further secure the position from any bearish threat.

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