A gauge of global stocks retreated into negative territory as all three major Wall Street indices were going downwards by more than 1%, ahead of the US central bank monetary policy announcement and several important macroeconomic data from various parts of the world, such as the continental Europe (Eurozone 4Q22 figures, CPI and Unemployment Change of French & German), China (Jan. Manufacturing PMI), US (Jan. Consumer Confidence). Germany’s 4Q22 GDP has begun this series of economic data announcements by coming in at 0.5% YoY (vs. 0.8% forecast, vs. 1.3% previous) and contracting -0.2% QoQ (lower than the last quarter’s 0.5%), indicating an apparent economic slowdown. Market participants currently decided to Wait & See regarding the Federal Reserve’s final decision at the Federal Open Market Committee Meeting, which will be held from January 31 – February 1, to raise the Fed Fund Rate (FFR) by 25 bps that would bring the policy rate to the 4.5%-4.75% range; while the Bank of England and European Central Bank, both of which are primarily expected to hike by 50 bps. Moreover, the market anticipates rates to peak at about 4.9% in June before retreating to 4.5% by year-end.
JCI was dragged into the negative global market sentiment where yesterday had to shed 26.5 points or down to 6872.5, where LQ45 also deflated 0.45%; however, Net Foreign Buy was recorded at IDR 277.79 billion & Rupiah remained at IDR 14979/USD. It is no surprise for JCI to pull back after entering the critical Resistance area of 6900. This consolidation is still reasonable as it is supported by MA10 & MA50 Support at yesterday’s Low of 6834, up to 6820; or lower to MA20/6765 Support. NHKSI RESEARCH advises investors/traders to Wait & See first while digesting this week’s developments which are full of crucial information that determines the direction of global finance.
Download full report HERE.
