All three of Wall Street’s major indexes closed mixed on Tuesday (30/05/23), pressured by worries about US lawmakers opposed to a deal to raise the USD 31.4 trillion debt ceiling. The uncertainty still remains although US President Joe Biden and Republican Kevin McCarthy met over the weekend and reached an agreement, it is still likely to be opposed by other Republican officials. In terms of interest rates, economic data showed US Consumer Confidence (May) rose above forecasts, this \ reinforces the prediction that the US central bank may still need to raise interest rates further to combat inflation. Traders are pricing in a 65% probability of a 25 bps Fed Fund Rate hike at the upcoming FOMC Meeting on June 13-14. Today other important economic data from other regions of the world will be awaited, such as: Japan Industrial Production (Apr) which was released unexpectedly lower than expected this morning, entering the negative 0.4% area; followed immediately by Chinese Composite PMI (May), German Unemployment Change (May), German CPI (May), and in the evening the US JOLTs Job Opening (Apr) labor report which is expected to add 9.775 million, up from the previous period of 9.590 million.
This week become a short trading week for Indonesia as the JCI is faced with a two-day holiday June 1-2, while on Friday investors will closely monitor the Nonfarm Payrolls (May) and US Unemployment Rate (May) data which will give some impact on the Fed’s decision at their meeting next month. JCI which has also not been able to recover above MA10 Resistance still opens the potential for high volatility and the threat of further consolidation towards 6600-6550, although amidst the reddening of stock prices yesterday, foreign net buy was recorded at IDR 431.79 billion. NHKSI RESEARCH advises Indonesian investors/traders to maintain a Hold or Wait & See position considering the long holiday ahead contains too many uncertainty factors.
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