Global Market Updates
• Wall Street equities had a varied outcome at Thursday’s close (Dec 28, 2023), DJI edge up, +0.30%, S&P 500 rose +0.14%, and Nasdaq eased by -0.05%.
• Stock markets closed with mixed results on Thursday, as expectations of an early interest rate cut by the Federal Reserve supported stocks. Additionally, technology stocks found backing from the enthusiasm surrounding artificial intelligence, leading to increased gains in chip stocks.
• US Treasury 10-yr yields increased by +5 bps, reaching 3.84%, while the shorter-termed UST 2-yr yields surged by +6 bps reaching 4.26%.
• Treasury yields rose as investors assessed the upcoming year’s outlook for the economy and financial market.
• The US weekly initial unemployment claims climbed by 12,000 to reach 218,000, indicating a labor market weaker than the anticipated rise to 210,000.
• November's pending home sales in the US remained flat month-over-month, falling short of the anticipated 0.9% increase.
• Global bond yield on Thursday moved lower; the German bund 10-yr yield rose +4.9 bps to 1.38%, the UK gilt 10-yr yield grew +5.7 bps to 3.49%. The Japanese GB 10-yr yield decreased by -1.60 bps to 0.60%.
Domestic Market Updates
• Indonesian benchmark series of LCY government bonds closed lower on Thursday (Dec 28, 2023), with the 10-yr benchmark yield dropping -0.73 bps to 6.46%.
• IDR strengthened against the USD (USD/IDR fell by -0.10% to 15,420) on Thursday. The IDR appreciated due to various positive sentiments, driven by significant influx of foreign funds and a 'wait and see’ approach toward US job data.
• Tax revenue reached 101.3% or IDR1739.8tn by December 12, 2023, surpassing the IDR1.718tn target set in the 2023 State Budget (APBN) under Law Number 28 of 2023.
• At the year-end Thursday’s SUVBI auction, there was a decline in investor interest, and the winning bid amounted to only USD25mn, down from the previous USD65mn.
• On Thursday’s Indo GB series trading, SPN12240104 and SPN12240201 maintained the top spot in the bond market, boasting significant trade volumes of IDR1.45tn and IDR1.12tn, respectively. Moreover, FR77 and FR81 showed notable 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 6.45-6.60% for today.
• Attractive Indo GB series to be traded today : FR0040, FR0081, FR0096, FR0100.
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