Today’s Outlook:
• Global stock indexes moved lower in Wednesday’s trading as a disappointing performance forecast from Advanced Micro Devices (AMD) weighed on chipmakers in the US Technology sector, while Gold prices rose to record highs as uncertainty ahead of next week’s US ELECTION boosted safe haven demand. The Dow Jones Industrial Average fell 91.51 points, or 0.22%, to 42,141.54, the S&P 500 lost 0.33%, while the Nasdaq Composite depreciated 0.56%. The global MSCI index fell 0.37%, to 844.94.
• MARKET SENTIMENT :
– The 3rd QUARTER FINANCIAL REPORT presented figures of major Tech sector companies such as Alphabet which reported quarterly earnings that beat estimates, causing its share price to crawl up 2.8%. Semiconductor company Advanced Micro Devices fell 10.6% after its revenue and artificial intelligence chip sales forecasts disappointed investors. Other chipmakers also fell, with Nvidia down 1.4%. After the closing bell, shares of Facebook owner Meta Platforms fell 1.5% after it beat analyst estimates for third-quarter revenue and profit but warned of a “significant acceleration” in infrastructure costs associated with its AI build. Two other big Tech names, Apple and Amazon.com will report results later on Thursday. Market participants are obsessed with the sector’s results, as their share prices have risen sharply so far this year, and analysts are optimistic that the performance of these megacap companies will still help support the overall market.
– ECONOMIC INDICATORS: Data showed that job creation in the US private sector surged in October to 233k, compared to 110k forecast. On the other hand, the preliminary estimate of US 3Q GDP showed a rather sluggish 3Q economic growth at 2.8% qoq, rather than 3.0% forecast and in line with the previous quarter. NONFARM PAYROLL, the climactic employment sector data scheduled for release on Friday, forecasts 113,000 jobs in October (according to a Reuters poll of economists), but analysts note the number could be lower due to recent hurricane disruptions in some areas including Florida and North Carolina. By tonight, a number of important new data await: PCE PRICE INDEX (Sept), INITIAL JOBLESS CLAIMS, PERSONAL SPENDING (Sept).
– US ELECTIONS: A recent Reuters/Ipsos poll showed Vice President KAMALA HARRIS, a Democrat, outperforming Republican DONALD TRUMP by 44% to 43% among registered voters nationwide, within the margin of error. Other polls show tight margins in seven electoral battleground states.
• EUROPEAN & ASIAN MARKETS: The UK stock market hit its lowest level since August as UK Finance Minister Rachel Reeves said she would raise taxes by 40 billion pounds (USD 52 billion) a year in her first budget. Major EUROPEAN stock indexes fell to their lowest levels in more than a month as Technology and Mining stocks led broader market declines. The STOXX 600 index closed 1.3% lower, while the FTSE 100 fell 0.7%.
– Speaking of GDP, GERMANY released a much better than expected economic growth where in Q3 their GDP came in at 0.2% qoq, bouncing back from a (near) recession in the previous quarter of -0.3%. Similarly, EUROZONE showed their economy grew faster than expected in the last quarter, at 0.4% qoq, compared to forecast & Q2 at 0.2%. On the one hand, GERMAN CPI for Oct supported this economic growth as their Inflation rose in Oct to 2.0% yoy, 0.2% hotter than forecast & 0.4% higher than the previous month. This afternoon, it is the EUROZONE’s turn to report their preliminary CPI (Oct) and Unemployment Rate (Sept) figures.
– CHINA this morning is set to announce their PMI conditions where both Manufacturing and Services sectors are able to stand in expansionary territory. Afterwards, BANK OF JAPAN’s decision on interest rate will be in the spotlight, consensus expect it to remain unchanged at 0.25%.
• COMMODITIES: GOLD rose to an all-time high as uncertainty over the November 5th US ELECTION increased safe haven demand. Spot gold prices rose 0.5% to USD 2,788.87/ounce, after hitting a record high of USD 2,789.73 earlier in the session.
– In the energy market, OIL prices bounced back from early week declines, supported by data on Wednesday showing US crude oil and gasoline inventories unexpectedly fell last week to a 2-year low thanks to strengthening demand; and OPEC+ is expected to postpone production increases originally planned for December. After falling more than 6% last week due to the easing of potential escalation of the MIDDLE EAST CONFLICT, BRENT crude oil prices finally closed up 2.01%, at USD 72.55/barrel. Meanwhile, the price of US WTI crude oil jumped 2.08%, to USD 68.61.
• CURRENCY & FIXED INDOME: The DOLLAR weakened against other major currencies after stronger-than-expected US labor data and the UK budget release. The DOLLAR INDEX (DXY), which measures the strength of the USD against six other major currencies, rose to 104.43 early in the session but was last down 0.17% to 104.06. POUNDSTERLING, which fell as much as 0.6% as Reeves delivered the Labor government’s first budget, was last down 0.34% at USD 1.2971.
– The benchmark 10-year US TREASURY YIELD pared earlier losses and short-term yields rose on strong US economic data ahead of Friday’s jobs report. The yield on the 10-year note was last down 1 basis point at 4.264%, after hitting a nearly four-month peak of 4.339% on Tuesday.
– Among risk assets, BITCOIN fell slightly after surging to near all-time highs since March as investors weighed the prospect of a Trump victory, which is widely seen as favorable for crypto. Bitcoin edged down 0.12% to USD 72,221.00.
• JCI seemed struggling to hold on to the Support lane drawn since June bottom, causing last Wednesday’s Closing position to plunge again 36.75pts / -0.48% to 7570 level, poured by foreign sell-off of IDR 1.45 Trillion, enlarging FOREIGN NET SELL at IDR 6.52 trillion throughout this month of Oct. NHKSI RESEARCH still needs to remind you to HOLD your position, better WAIT & SEE first to face the turmoil of regional sentiment this week which is loaded with important data, as well as welcoming the US ELECTION next week which is more or less pro other financial instruments than emerging-market equity markets.
Company News
• ARKO: Astra Group Issuer Officially Operates Yaentu Power Plant
• BUKA: Bukalapak Plans Restructuring and Layoffs, Here’s Why
• GOTO: GOTO’s Net Loss Shrinks 55%, Patrick Walujo Reveals Strategies
Domestic & Global News
ESDM Targets Coal MIP to Be Established by 2025
Lebanon, Israel Could Agree to Ceasefire Within Days, Lebanese Prime Minister Says
Download full report HERNH_Daily_Oct_31_2024_(English)E.
