The rise in US stock indices can be said to create a January Barometer that signalled an upbeat year, starting with the S&P 500 rising 6.2% in January (close to a 5 month high) with 7.7% YTD (vs minus 19.4% last year, which was the worst decline since 2008). The Nasdaq as well experience the Uptrend with 5 consecutive weeks of gains, one of the most sustainable since late 2021. Domestically, Rupiah has been consistently below 15K, which has stimulated the Finance sector and brought JCI to close above the psychological level of 6900. However, it has not been supported by foreign net buy, as the Net Sell was still recorded at IDR 460.22 billion last week. Moreover, the market was supported by a series of positive sentiments from global & US macroeconomic data, topped off by last Friday’s unexpectedly strong US nonfarm payrolls report, which rose well above expectations while the unemployment rate fell to a 53.5-year low; keeping fears that the Federal Reserve will maintain a tight monetary policy that eventually leads the economy into recession. The US Central Bank officially raised US interest rates another 25 bps to a range of 4.5%-4.75%. The ECB & BOE raised benchmark rates 50bps to 3% and 4%, respectively, with the Bank of England implying that the highest level of inflation has passed and the European Central Bank indicating at least one more (rate) hike to come.
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