JCI Rallied Despite Worse Global State
Global sentiments were major catalysts for JCI’s last week moves. The inverted yield curve for US Treasuries, a preliminary signal of recession and the increasingly bitter trade disputes between the US and China had been a drag on JCI and culprit in foreign outflows of IDR900 billion dated Monday, Aug. 26, 2019. The yields relationship between the two-year Treasury bonds and the 10-year Treasury bonds turned upside down as longer-term yields bottoming shorter-term ones yelled warning of the US economy moving toward a recession. Adding to the early signal of the US recession was the worsening tariff wars between the world’s two powerhouse economies. China confronted US locking an additional 15% tariffs in Sept. 1st by USD750 billion worth of countermeasures against the US goods. The dismal global state failed to dismay Asia markets as trading activities in most of Asia markets were rebounding on the mid-days of last week. The uncertainty about the US and China trade resolution and the removal of South Korea from Japan’s white list of favored trade partners drove investors to buy
large-cap. stocks. Apart from the global highlights, the relocation of Indonesia’s seat of power from Jakarta to East Kalimantan—North Penajem and Kutai Kartanegara districts—stands to benefit property and construction stocks. On Friday of Aug.30, 2019, JCI was rebounding, underpinned by foreign outflows of IDR68 billion.

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