Today’s Outlook:
Most market participants’ thoughts lately are hoping to see US Inflation figures (May) ease again despite Core Inflation likely remain unchanged. Traders see a 76% chance of the central bank holding rates at the 5%-5.25% range, pricing in a 71% chance of a rate hike in July, according to the CME Group Fedwatch tool. The bullish market in recent weeks s has been fueled by gains in megacap stocks, better-than-expected quarterly earnings and hopes that the Fed might be nearing the end of its monetary tightening cycle. The rally has recently widened to include the other sectors, Energy and Industrial, as economic data continues to show a resilient US economy despite higher interest rates, indicating a soft landing was achieved.
Indonesia announced its Consumer Confidence Index (May) figures yesterday, which moved back up to 128.3 from 126.1 in April; indicating a growing optimism towards the Indonesian economy. As evidenced by the Motorcycle Sales report in May, it jumped drastically by 113.4% compared to – 19.4% in April. Later today, we will monitor the Retail Sales data which could be higher than 4.9% last period. Some important economic data from other parts of the world will also grab the attention of the financial world today such as: UK employment data, German Inflation (May), Eurozone & German ZEW Current Conditions & Economic Sentiment (June); and of course the eagerly awaited highlight at 19.30 WIB is the release of US Inflation figures (May) which is predicted to flatten to 4.1% yoy (vs previous 4.9%).
Corporate News
Maybank Indonesia (BNII) Paid Off Matured Bonds Worth IDR 819.25 Billion PT Bank Maybank Indonesia Tbk (BNII) has paid off the 2016 Sustainable Subordinated Bonds II Phase II worth IDR 819.25 billion. The repayment of principal and interest on subordinated bonds amounted to IDR 819.25 billion, consisting of principal of IDR 800 billion and interest on the 28th subordinated bond (gross) of IDR 19.25 billion. Furthermore, Muhamadian stated, the source of funding used for the repayment of principal and the last interest payment on Subordinated Bonds is from liquid assets and other cash flows. Muhamadian said, with the principal repayment of the Subordinated Bonds, since June 12, 2023 the Subordinated Bonds will no longer be listed and can no longer be traded through the IDX and or reported on trading through the facilities provided by the IDX. (Kontan)
Domestic Issue
Total Bond Issuance Reaches IDR 39.56 Trillion The Indonesia Stock Exchange (IDX) noted that the total bond and sukuk emissions that have been recorded throughout 2023 are 35 emissions from 31 issuers worth IDR 39.56 trillion. Therefore, the total bond and sukuk emissions recorded on the IDX to date amount to 519 emissions with an outstanding nominal value of IDR 443.69 trillion and USD 47.5 million, issued by 127 issuers. Then Government Securities (SBN) listed on the IDX amounted to 191 series with a nominal value of IDR 5,536.74 trillion and USD 486.11 million. Asset-Backed Securities (EBA) as many as 8 emissions worth IDR 3.02 trillion. The information was conveyed by the IDX in a press release in Jakarta, yesterday. (Neraca)
Recommendation
US10YT looks steady above MA10 & MA20 Support, making the yield range of 3.727-3.695% the closest Support at the moment. US10YT still has a chance to continue this short term Uptrend towards TARGET yield: 3.839% / 3.97%. ADVISE: Average Up accordingly. ID10YT is trying to break the MA10 & MA20 Resistance upwards to yield 6.403%. ADVISE : If this downtrend channel pattern is able to be broken, then it opens up the potential to rise towards TARGET: 6.540% (MA50) or 6.65%. ADVISE: Average Up accordingly.
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