Today’s Outlook:
• U.S. indices advanced on Wednesday. The S&P 500 and Nasdaq Composite scaled to record highs Wednesday, with tech shares leading the charge following strong reports from Salesforce and Marvell Technology. The broad market index gained 0.61%, closing at 6,086.49, while the tech-heavy Nasdaq advanced 1.3% to 19,735.12. The Dow Jones Industrial Average advanced 308.51 points, or 0.69%, to 45,014.04. All three major averages hit all-time highs during the session and closed at records, with the 30-stock Dow ending above the 45,000 threshold for the first time.Wednesday’s moves come as investors await new U.S. employment data due Friday. Economists polled by Dow Jones expect the U.S. economy added 214,000 jobs in November.
• ASIA MARKETS: Asia-Pacific markets rose Tuesday, tracking gains on Wall Street after the S&P 500 and the Nasdaq Composite rose to new records overnight. Japan’s Nikkei 225 traded 2.22% higher, and the Topix added 1.71%. South Korea’s Kospi was up 1.71% while the Kosdaq advanced 2.03%. South Korea’s inflation rate climbed in November to 1.5% year on year, higher than October’s inflation reading of 1.3%, and lower than the 1.7% expected by economists polled by Reuters. Hong Kong’s Hang Seng Index gained 0.65% in its final hour of trade, and mainland China’s CSI 300 was up 0.11% to close at 3,951.89. Traders are preparing for a wave of economic reports and comments from Federal Reserve officials that will influence the future direction of interest rates. – Traders will be monitoring the the U.S. November payrolls report, due Friday, which could provide insights into the strength of the labor market ahead of the Federal Reserve’s policy meeting on Dec. 17-18.
• CURRENCY & FIXED INCOME: The Dollar Index was little changed overall, as the December interest rate cut chances remained on track amid signs that the American economy was slowing. The South Korean won, one of the biggest movers, rose against the dollar, bolstered by suspected central bank intervention and the finance ministry’s pledge of “unlimited” liquidity support to markets. That came a day after South Korean President Yoon Suk Yeol declared martial law in a late-night television address, only to lift it hours later. The benchmark U.S. 10- year Treasury ticked higher on Tuesday as investors mulled over recent job openings data. The 10-year Treasury yield added 4 basis points to 4.232%, while the yield on the 2-year Treasury dipped 2 basis points to trade at 4.177%. Yields and prices move in opposite directions, and one basis point equals 0.01%.
– The euro rose marginally against the U.S. dollar on Wednesday, but came off session highs, after a widely expected collapse of the French government following a no-confidence vote by opposition lawmakers. The euro was slightly up against the dollar at USD1.0512 after far-right and left-wing lawmakers joined forces to back a no confidence motion against Prime Minister Michel Barnier and his government, with a majority 331 votes. Barnier is expected to tender his resignation and that of his government to President Emmanuel Macron shortly.
– European markets closed higher Tuesday, with investors keeping an eye on political upheaval in France. The pan-European STOXX 600 index provisionally ended the day up 0.44%, with sectors mostly trading in positive territory. Retail stocks led gains, up 1.56%. France’s financial markets are being closely watched Tuesday after Prime Minister Michel Barnier turned to special constitutional powers to pass a contested budget bill without a parliamentary vote.
– Investors also digested comments from European Central Bank President Christine Lagarde in a parliamentary hearing on Wednesday. She said the ECB will continue to lower rates, but did not commit to any pace of easing. The ECB will next meet on Dec. 12, and economists overwhelmingly expect another 25 basis-point (bp) rate cut, the fourth such move this year.
• COMMODITIES: Oil prices climbed more than 2% on Tuesday, as investors hone in on the outcome of an OPEC+ meeting later this week. Brent crude futures rose USD1.79, or 2.49%, to close at USD73.62 a barrel, while U.S. West Texas Intermediate crude climbed USD1.84, or 2.7%, to close at USD69.94. OPEC+ is likely at its meeting on Thursday to extend its latest round of oil output cuts until the end of the first quarter, four OPEC+ sources told Reuters, to provide additional support for the oil market. However, the prospect of an oil market surplus has exerted downward pressure on prices, with Brent trading nearly 6% below its average for December 2023.
– Gold prices rose modestly on Tuesday after a strong U.S. labor report, while a softer dollar and easing Treasury yields limited losses as markets awaited more economic data to gauge the Federal Reserve’s rate path. Spot gold ticked up 0.2% to USD2,665 per ounce. Prices were up as much as 0.7% before the U.S. job openings data. U.S. gold futures rose just 0.1% to USD2,642.45.
• JCI continued its rebound by 130.65 bps / +1.82% to 7,326.76 with a marubozu candle but has reached . NHKSI RESEARCH thinks JCI has found a solid ground to rebound and appears to begin its window dressing journey into the last month of 2024. Investors/traders are advised to shift to BUY for stocks that have rebounded from support area earlier this week. RUPIAH exchange rate is entrenched at 15,924/USD, there are hopes of “strengthening” Rupiah towards 15,600 – 15,500 at the end of this year based on the plan to cut FFR at the FOMC MEETING on 17-18 December.
Company News
• EXCL: XL Axiata President Director Dian Siswarini Suddenly Resigned
• MEDC: MEDC Offers IDR2.5 Trillion Bonds to Pay Off Debt
• FILM: MD Entertainment Approves Right Issue of 989.7 Million Shares
Domestic & Global News
Cold Response from Workers & Entrepreneurs after the Minimum Wage Increase of 6.5% is Announced
All South Korean Ministers Submit Resignations After Martial Law
Download full report HERE.
