Global stock markets managed to post the biggest weekly gain in 4.5 months, while US Treasury yields dropped for the first time in 9 quarters; as US Inflation data reflected in the PCE Price Index (Feb.) managed to tick lower than expected at 5% YoY (vs. 5.3% previous). The monthly Personal Spending rate (Feb.) also fell to 0.2% from the previous month at 2%. This was in line with Michigan Consumer Expectation & Sentiment (Mar.) which appeared to contract both from forecast & previous. Dow Jones et al closed last week solidly in positive territory thanks to gains above 1%. Expansionary economic trend was also shown by Chinese Composite PMI (Mar.) which grew to 57 (vs previous 56.4) and Japan Industrial Production (Feb.) which jumped dramatically to 4.5% mom from minus 5.3% the previous month. UK GDP for 4Q22 also showed growth of 0.6% yoy from 0.2% the previous quarter. The Eurozone can be happy that Inflation (Mar.) finally eased to 6.9% YoY, an achievement as it was lower than the forecast of 7.1% and the previous 8.5% (although on a monthly basis their Core Inflation still rose 1.2% MoM, versus 0.8% the previous month). On Sunday, a surprise move came out from OPEC+ that plans to cut production by more than 1 million barrels/day, an action that will further boost world oil prices amid plummeting US oil inventories.
The Rupiah exchange rate strengthened sharply throughout last week and was able to close at IDR 14,990/USD, on the spot market or strengthened 0.37% on Friday trading (31/03/23). On a monthly basis, Rupiah strengthened 1.7% in March this year and 3.8% in the first quarter of 2023. The Industrial Confidence Index (ICI) in March 2023 declined after surging for four consecutive months from November 2022 to February 2023. One of the sectors contributing to the decline in the IKI is the textile and garment industry, which the government admits is still under pressure, especially exacerbated by the increasingly widespread thrifting trend. Bank Indonesia (BI) data based on transactions from March 27-30, 2023 shows that foreign investors recorded a net buy of IDR 10.97 trillion. Net buy in the Government Securities (SBN) market reached IDR 8.37 trillion while in the stock market touched IDR 2.6 trillion. Thus, from the beginning of the year to March 30, 2023, foreign investors’ net buy was recorded at IDR 54.11 trillion. Today we will look forward to Inflation data (Mar.) which is expected to soften further to 5.20% from 5.47% (Feb.) NHKSI RESEARCH assesses that there are quite a lot of positive sentiments in the market therefore it is expected to bring a north wind for JCI, trying to break through the mid-term Resistance in the range of : 6820-6870. Advise: Average Up accordingly.
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