• The Dow Jones index closed 0.1% lower on Monday (04/12/23), amid a 0.8% slump in the Nasdaq Composite triggered by rising US Treasury yields ahead of the Nonfarm Payroll report later this week. The 10-year US Treasury yield rose 4 basis points to 4.266%, with some arguing that the recent decline in yields is due to the market pricing in a Fed rate cut too soon. As reported by Investing.com’s Fed Rate Monitor Tool, there is already a 97% probability that the Fed will hold rates at 5.25% – 5.50% at this month’s FOMC Meeting. Meanwhile, there is already more than 50% chance (up from 21% last week) that the central bank will be able to cut 25bps as early as the March meeting next year. This was supported by yesterday’s US economic data which reported Factory Orders for Oct fell deeper than expected. Later tonight will be the US PMI data, which is expected to at least stay in expansionary territory; as well as the JOLTs Job Opening figures for Oct which is likely to come out lower than Sept.
• ASIA & EUROPE MARKETS: South Korea announced its Inflation rate for November this morning, which managed to ease to 3.3% yoy, lower than the 3.7% expected and from the previous month’s 3.8%. In contrast, South Korea’s economic growth improved with Q3/2023 GDP figures released at 1.4% yoy compared to 0.9% in the previous quarter. In a neighboring country, Japanese Inflation (in Tokyo in particular) also appears to be under control with Tokyo CPI (Nov) figures published this morning at 2.6% yoy (vs previous 3.3%), while Tokyo Core CPI (Nov) also cooled to 2.3% yoy (vs previous 2.7%). Further today, market participants will closely monitor Japan & China PMI figures, as well as some from major European countries such as: Germany, Eurozone, and UK.
• Speaking of the European continent, Germany reported an improved Trade Balance Surplus in Oct of EUR 17.8 billion, amid negative Export & Import growth but at least it was better than the previous month. Later this afternoon around 17.00 GMT, we will await the release of Oct producer-level inflation (PPI) data from the Eurozone region, which is predicted to show another deflation at -9.4% yoy, although this figure is slightly up from the previous position of -12.4%.
• Gold prices hit an all-time high on Monday, but then fell back, as market participants bet on a potential Federal Reserve interest rate cut next year. Spot Gold was largely unchanged at USD2,071.29 per troy ounce, retreating slightly from an earlier rally that had lifted the safe haven asset to a record USD2,135 per troy ounce. Gold posted strong gains last week, and also rose for the second consecutive month in November.
• The prospect of falling borrowing costs bodes well for gold, given that elevated rates push up the opportunity cost of investing in non-interest bearing assets like the metal. This notion had battered bullion prices over the past year. But markets still have a slew of economic figures to assess that is very likely to influence the US central bank’s decision going forward.
• Oil prices fell on Monday on concern about a drop in demand and on continued uncertainty about the depth and duration of OPEC+ supply cuts. Brent crude futures settled down 85 cents, or 1.08%, at USD78.03 a barrel. U.S. West Texas Intermediate crude futures finished down USD1.03, or 1.39%, at USD73.04. Monday’s fall adds to a 2% decline last week after the supply cuts announced on Thursday by the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, together known as OPEC+. Saudi Arabia’s energy minister Prince Abdulaziz bin Salman said in a televised interview with Bloomberg on Monday that he expected OPEC and its allies to bring about the 2.2 million in crude oil production cuts announced last week.
• Seeing the closing position of JCI yesterday after touching the NHKSI RESEARCH year-end target in the 7130-7150 area, we inevitably recommend investors/traders to prepare your Trailing Stop level. The appearance of a Shooting Star candle in the Resistance area indicates the amount of selling pressure at the upper price. Although the bullish aura still seems to persist, please pay more attention to the direction of market interest before pouring more funds into the stock market.
• BBNI : Salurkan Pembiayaan Kepada 1,61 Juta UMKM
• SMGR : Injeksi Modal SMI IDR74,25 Miliar
• PGAS : Anggarkan Capex USD458 Juta Hingga Akhir 2023
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