Global Market Updates
• Wall Street equities concluded with a mixed performance on April 1. The DJI closed lower by -0.60%, the S&P 500 slid by -0.20%, while the Nasdaq edged up by +0.11%.
• Stocks surged on Monday, initially led by the strength of chip stocks. While, the Nasdaq 100 reached a one-week high, the S&P 500 later retreated from a new record high amid rising bond yields, fueled by the robust US March ISM manufacturing index. The report's hawkish undertones could postpone anticipated Fed rate cuts.
• US Treasury 10-yr yields surged by +13.0 bps to 4.33%, while 2-yr yields jumped by +13.0 bps to 4.72%. Treasury yields continued to rise as the second quarter began, driven by hawkish remarks from Fed Chair Powell last Friday. Additionally, the annual PCE inflation comes 2.5% as anticipated, but still exceeded the CB’s 2% target.
• In March, the US ISM manufacturing index rose to 50.3, beating expectations of 48.3, signaling the strongest expansion in 1-1/2 years. Additionally, the ISM prices paid sub-index surged to a 1-1/2 year high of 55.8, surpassing expectations of 53.0.
• In February, US construction spending unexpectedly declined by -0.3% MoM, contrasting with expectations of a +0.7% MoM increase.
• In Asia, China's Caixin March manufacturing PMI increased by +0.2 to 51.1, reaching its highest level in 13 months. This extends the expansion streak for a fifth consecutive month, the longest in over two years.
• Global bond yields were mixed on Monday; The German bond trade were closed for the Easter Monday holiday. Meanwhile, the UK 10-yr gilt yield edged down by -0.1 bps to 3.92% and the Japanese 10-yr JGB yield rose by 1.2 bps to 0.74%.
Domestic Market Updates
• Indonesian benchmark series of LCY government bonds closed mixed on April 1, with the 10-yr benchmark yield inched down by -0.03 bps to 6.69%, while the 2-yr yield surged by +2.74 bps to 6.34%.
• The IDR depreciated against the USD on Monday’s close (USD/IDR rose by +0.22% to 15,890). The Rupiah weakened at the beginning of trading this week following the release of high inflation data.
• The Central Statistics Agency (BPS) reported that inflation in March 2024 increased to 0.52% MoM/ 3.05% YoY from the previous month’s 0.37% MoM/ 2.75% YoY, respectively. Core inflation rose to 0.23% MoM from the previous month's 0.14%, attributed to heightened seasonal demand during Ramadan and Eid al-Fitr.
• As of March 31, 2024, 12.7 million taxpayers have filed their annual tax returns (SPT), according to the Directorate General of Taxes (DJP) under the Ministry of Finance. This represents a 4.92% increase compared to the same period in 2023.
Market Forecast
• Given the recent developments that unfolded within the global and domestic markets, we expect the 10-yr Indo GB yield to move within the range of 6.55-6.70% for today.
• Attractive Indo GB series to be traded today : FR0081, FR0059, FR0099, FR0101, FR0096, FR0098.
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