Global Market Update
• U.S. saw an increase of job openings by 749,000 from a month earlier to a new series high of 10.934 mn in July-21.
• The number of job openings were well above market expectation of 10 mn indicating a labor supply constraint.
• However U.S. IBD/TIPP economic optimism index plunged by 5.1 points to 48.5 in September-21. The drop in optimism was primarily driven by latest Covid-19 wave.
• The 10 year U.S. treasury yield declined by 3 bps to 1.34% yet still posting an increase of 5 bps from a week earlier.
• Overall the U.S. treasury yields dropped 1-4 bps along the curve on Wednesday (09/08/21).
• Government bond yields across DM & EM countries saw an upward pressure on a weekly basis.
• Last night, U.S. stock market tumbled with DJI dropped 0.2%, S&P 500 plunged 0.13% and Nasdaq Composite fell 0.57%.
Domestic Market Update
• ICBI closed at 327.83 yesterday after contracting by 0.1% from the previous trading session.
• The 10 year Indo GB yield rose by 5.8 bps to 6.17% in line with our expectation.
• All the Indo GB benchmark series (FR0086, FR0087, FR0088 & FR0083) saw a price correction.
• The domestic financial market was under pressured yesterday with IDR fell 0.28% to IDR 14,253/USD and JCI dropped by 1.41%.
• Bank Indonesia (BI) reported the domestic consumer sentiment remained in a contractionary zone in August-21.
• The consumer confidence index declined 2.9 points to 77.3 in August-21 from 80.2 in the previous month. It was the weakest reading since October-05.
• The consumer sentiment was deteriorated during the implementation of social restriction (PPKM leveling) in Java & Bali.
Market Projection
• We expect the 10 year Indo GB yield to move within range of 6.10%-6.20% following the global yields trend.
• Attractive Indo GB series to be traded : FR0086, FR0064, FR0071, FR0078, FR0082, FR0087, FR0085, FR0068 & FR0072.
Disclaimer
