Today’s Outlook:
• Global stock indices closed in positive territory in the first trading day of November last Friday (01/11/24), with AMAZON.com shares rallying following a better-than expected earnings report, while the 10-year US TREASURY YIELD hit a 4-month high as investors increasingly refrained from buying bonds before the US ELECTION on Tuesday (05/11/24). The DJIA rose 288.73 points, or 0.69%, to close at 42,052.19; the S&P 500 gained 0.41%, the Nasdaq Composite lifted 0.80%. The MSCI GLOBAL stock index rose 2.85 points, or 0.34%, to 835.15.
• MARKET SENTIMENT: US Treasury yields initially fell after US NONFARM PAYROLL data for October showed the US economy barely added jobs in October with a figure of just 12k (much lower than the consensus of 106k and down sharply from the Sept figure which was already revised down to 223k), although the Oct labor data was understandably affected by hurricane disruptions and industrial strikes. However, the Unemployment Rate (Oct) in the US remained stable at 4.1%, as well as Average Hourly Earnings (Oct) which increased by 0.4% mom provided assurance that the labor market remains in a solid position.
– S&P GLOBAL US Manufacturing PMI (Oct) showed the manufacturing industry improved to 48.5 from 47.8 in the previous month, although it has not yet moved out of contraction territory.
– MARKET REBALANCING: After market, S&P Dow Jones Indices said NVIDIA will be added to the Dow Jones Industrial Average, replacing Intel. Nvidia shares rose 1.9% in after-hours trading while Intel fell 1.4%. COMPANY FINANCIAL REPORTS presented an improved outlook for AMAZON.COM’s performance in the holiday suggested 4th quarter, boosting its share price 6.2%; offsetting APPLE’s 1.2% decline following the iPhone maker’s moderate growth outlook. With the outlook still optimistic on the big Tech names, the recent sell-off is likely to be utilized as an opportunity to buy back the stocks.
– US ELECTION: Polls show Republican DONALD TRUMP and Democratic Vice President KAMALA HARRIS almost neck and neck in the final days leading up to the US ELECTION. Some strategists say the US fiscal trajectory is expected to worsen under either Trump or Harris.
• FIXED INCOME & CURRENCY: The benchmark 10-year US TREASURY YIELD was last up 7.7 basis points at 4.361%, the highest since July 5. This followed a total increase of 48 basis points throughout October, which was the largest monthly increase since April.
– THE US DOLLAR strengthened against the Euro and recovered against most major currencies after traders digested US jobs data. The Euro was down 0.40% against the Dollar at USD 1.084. The DOLLAR INDEX (DXY), which tracks the greenback’s strength against six other major currencies, was up 0.36% at 104.24. The dollar rose 0.60% against the yen to 152.94, ahead of the end of the three-day week in Japan. Early last week, the Yen got a boost from less dovish comments from Bank of Japan Governor Kazuo Ueda following the central bank’s decision not to change policy.
– BITCOIN, the world’s largest cryptocurrency by market capitalization, was up 0.57% on the day at USD 69,531 (= IDR 1.09 billion).
• EUROPE & ASIA MARKETS: Major European stock indices recorded their biggest one-day gains in 5 weeks, as banks led the overall market recovery after recent declines. The STOXX 600 index ended 1.09% higher.
– MANUFACTURING PMI: CHINA said the Caixin Manufacturing PMI (Oct) managed to be brought back into expansionary territory at a reading of 50.3. The result was in contrast to the UK which reported the S&P Global UK Manufacturing PMI (Oct) which actually slipped below the 50 mark. Today it’s the turn of GERMANY & EUROZONE to find out how their manufacturing activity developed in Oct via HCOB Manufacturing PMI data, while the US watches Factory Orders (Sept) growth.
• COMMODITIES: OIL extended its recent rally amid reports that IRAN is preparing a retaliatory strike against ISRAEL from Iraqi territory in the coming days. BRENT crude oil futures rose 29 cents to USD 73.10/barrel, while US WTI crude oil gained 23 cents to USD 69.49. GOLD prices fell slightly, pressured by a stronger US Dollar.
• INDONESIA: JCI closed the first trading day of November with a red note: depreciated 68.76 pts / -0.91% to 7505.25 level, driven down by Financials, Energy, and Basic Industry sectors. NHKSI RESEARCH expects market participants to be very focused on the fate of JCI in the near future, whether it will weaken further or be able to rebound around the critical Support of 7500-7450. From the economic data: Indonesia’s annual Inflation rate fell to 1.71% in October 2024, marking the lowest level since October 2021 while remaining within the central bank’s target range of 1.5% to 3.5%. On a monthly basis, CPI edged up by 0.08% in October, the first monthly increase in 6 months, after a 0.12% decline in September. Meanwhile, foreign tourist arrivals in Indonesia increased by 19.53% yoy to 1.28 million in September, as the tourism sector continued to recover. The S&P GLOBAL Indonesia Manufacturing PMI has not been able to move into expansionary territory, remaining at 49.2 in October 2024, unchanged for the second consecutive month, and showing a decline in factory activity for the fourth consecutive month.
Company News
• BIRD: Surplus 20.6 Percent, BIRD Third Quarter 2024 Profit IDR 436 Billion
• SCMA: Jumping 115 Percent, SCMA in the Third Quarter of 2024 Reaped IDR 509 Billion Profit
• SMAR: CPO Issuer of Sinarmas Group Earns IDR 1.03 Trillion, Almost Doubled
Domestic & Global News
Airlangga Talks about Debt Write-off Rules for Farmers & Fishermen
Rising from the Depression, China’s Property Market Begins to Revive
Download full report HERE.
