Global Market Updates
• Wall Street equities retreated after an initial climb on April 4, with the DJI fell by -1.35%, the S&P 500 declined by -1.23%, and the Nasdaq closed down by -1.40%.
• Stocks surrendered their early gains and underwent a sell-off on Thursday, with both the S&P 500 and Nasdaq 100 hitting 2-week lows, while the DJI plunged to a 2-1/2 week low. The bearish sentiment was fueled by hawkish remarks from Fed officials, including comment’s from Fed’s Harker's on persistent inflation and Fed’s Kashkari’s on potential delays in rate cuts if inflation progress stalls.
• US Treasury 10-yr yields closed down by -5.0 bps to 4.31%, and 2-yr yields closed down by -3.0 bps to 4.65%. T-note yields decreased in response to higher-than-expected US weekly jobless claims, which is considered as a dovish factor for Fed policy.
• US weekly initial unemployment claims increased by +9,000 to reach a 2-month high of 221,000, reflecting a labor market weaker than the expected 214,000.
• The US February trade deficit of -USD68.9bn exceeded expectations of -USD67.6bn and marked the largest deficit in 10 months, posing a negative factor for Q1 GDP.
• In Europe, the Eurozone March S&P Composite PMI was revised upward by +0.4 to 50.3 from 49.9, hitting its highest level in 10 months.
• Global bond yields moved lower on Thursday; The German bond yield fell by -3.4 bps to 2.36%, the UK 10-yr gilt yield slid by -3.5 bps to 4.02% and the Japanese 10-yr JGB yield closed down by -0.8 bps to 0.79%.
Domestic Market Updates
• Indonesian benchmark series of LCY government bonds closed mixed on April 4, with the 10-yr benchmark yield decreased by -0.70 bps to 6.67%, while the 2-yr yield surged by +0.95 bps to 6.34%.
• The IDR appreciated against the USD (USD/IDR fell by -0.17% to 15,893). Today's rupiah strength is bolstered by global market optimism of a potential interest rate cut. Furthermore, a 1.22% surge in the IHSG also contributed to the rupiah, reversing two days of foreign investor sell-offs.
• Bank Indonesia has set the result of the foreign exchange TD transactions from export earnings as of April 4, 2024, totaling USD68.75bn with bids submitted for a 3-month tenor with an average rate of 5.27%.
• In Thursday's Indo-GB series trading, FR98 and FR56 attracted significant interest in outright transactions, with substantial trade volumes of IDR2.15tn and IDR1.82tn, respectively. Additionally, PBS38, FR81, and FR102 experienced high trading frequency.
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, FR0101, FR0087, FR0096, FR0098.
Disclaimer On
