Company Update

09 Juli 2024

Fixed Income Report July 9, 2024

Global Market Updates     
• Wall Street equities closed mixed on July 8, with the DJIA fell by -0.08%, the S&P 500 edged up by +0.10% and the Nasdaq rose by +0.28%.
• Stocks indexes saw muted movement on Monday as the S&P and Nasdaq extended their gains from Friday's record highs following a jobs report that suggested a cooling labor market. This led to increased bets on a September rate cut by the Fed, with the CME FedWatch tool indicating that approximately 75% of traders expect a cut.
• The US Treasury market displayed mixed signals on Monday. The benchmark 10-year yield held steady at 4.28%, reflecting investor caution ahead of key economic data. Meanwhile, the shorter-term 2-year yield jumped by +2.0 bps to 4.62%.
• The US consumer expectations for inflation dipped in June for the second straight month, falling to 3.0% from 3.2% in May, reflecting a broad decrease in price outlooks.
• The Eurozone Sentix Investor Confidence Index for July registered a significant decline, reaching -7.3. This reading fell short of expectations, which were at -0.6.
• In Asia, Japan's current account surplus for May 2024 climbed to JPY2,849.9 billion, surpassing market forecasts of JPY2,450 billion. This represents a substantial increase compared to the JPY2,010.1 billion surplus recorded in May 2023.
• Global bond yields were mixed on Monday: the 10-yr German bund yield fell by -1.6 bps to 2.54%, the 10-yr UK gilt yield slid by -1.2 bps to 4.11%, and the Japanese 10-yr JGB yield rose by +1.6 bps to 1.10%.
Domestic Market Updates 
• The Indonesian benchmark series of LCY government bond were mixed on July 8, with the 10-yr benchmark yield fell by -3.21 bps to 7.01%, while the 2-yr yield rose by +2.20 bps to 6.67%.
• The IDR strengthened against the USD on Monday as anticipation of a Fed rate cut buoyed markets, with the USD/IDR exchange rate dropping -0.14% to 16,255 and the DXY dipping to 104.87.
• As of July 4, 2024 non-residents have recorded a net sell of IDR32.58 trillion in the SBN market, a net sell of IDR9.06 trillion in the stock market, and a net buy of IDR139.79 trillion in SRBI.
• The Ministry of Finance reported a budget deficit of IDR77.3 trillion (0.34% of GDP) in 1H24, driven by a -6.2% YoY decline in state revenue to IDR1,320.7 trillion (47.1% of the 2024 target) and an +11.3% YoY increase in spending to IDR1,398 trillion.
• In Monday's Indo-GB series trading, PBS032 and FR0100 garnered notable interest in outright transactions, with the highest trade volumes of IDR3.47tn and IDR2.20tn, respectively. Additionally, PBS032, PBS038, and FR0100 were the most actively traded series.

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 6.85-7.15% for today.
• Attractive Indo GB series to be traded today : FR0081, FR0084, FR0087, FR0074, FR0065, FR0080. 
Disclaimer On

FR81 FR84 FR87 FR74 FR65 FR80

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