Global Market Update
• Reopening UST auctions on Tuesday (12/27/22) following a holiday, yield on the benchmark of 10-year UST note jumped 9 bps to 3.84%.
• On the other hand, the yield for short term rate (UST 2-year) remained flat at 4.32%.
• The spread between 2/10 UST note yield narrowed to -48 bps (vs -56 bps the previous day).
• US equities indices mostly recorded a loss yesterday. The DJI up ticked 0.11%; while S&P 500 and Nasdaq Composite fell by 0.41% and 1.38% respectively.
• The US recorded a 2-year low goods trade deficit in Nov-22, narrowing 15.6% from Oct-22 to USD83.3 billion, as imports spending took on a huge cut for all sectors, while exports slightly rose 3.1% from consumer goods and vehicles.
• Housing starts in Japan unanticipatedly tumbled down 1.4% YoY in Nov-22 as opposed to market consensus of a 1.5% rise, while rent starts continued growing accompanied by resilient retail sales and domestic consumption.
Domestic Market Update
• The benchmark 10-year Indo GB yield (FR0091) remained stagnant at 6.89% on Tuesday (12/27/22).
• Risk perception as indicated by 5-year CDS remained steady at 100.46 bps.
• The IDR weakened against the USD and was closed at 15,663/USD on Tuesday (vs 15,633/USD the previous day).
• Ministry of Finance and Bank Indonesia has settled for a sixth Government Bonds transaction under the SKB III scheme, with a total nominal of IDR 128 trillion via private placement.
• The eight GB series issued in the transaction included VR0088, VR0089, VR0090, VR0091, VR0092, VR0093, VR0094 and VR0095.
Market Projection
• Given the recent development on global and domestic market, we expect the 10 year Indo GB yield to move within a range of 6.85-7.05% for today.
• Attractive Indo GB series to be traded today : FR0077, FR0037, FR0047, FR0052, FR0054, FR0096.
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