Global Market Updates
• Wall Street equities closed higher on Feb 29, with the DJI edged up by +0.12%, the S&P 500 rose by +0.52%, while the Nasdaq closed up by +0.90%.
• Stock indexes on Thursday posted moderate gains on signs that inflation pressures are continuing to ease. The Fed's preferred inflation gauge, the January core PCE, rose 2.8% in January, which right on expectations. Other favorable reports on Thursday, including weekly jobless claims, the January MNI Chicago PMI, and January pending home sales, lowered bond yields and boosted stocks.
• US Treasury 10-yr yields fell by -2.0 bps to 4.25% , while by 2-yr yields remained unchanged at 4.64% on Thursday. 10-yr yields fell after economic data released, supported by Fed officials which suggest potential easing if inflations decreases.
• US initial jobless claims rose to 215,000, up 13,000, indicating a weaker labor market than expectations of 210,000.
Meanwhile, US Feb MNI Chicago PMI unexpectedly fell to 44.0, below expectations of an increase to 48.0.
• US Jan personal spending met expectations with a 0.2% MoM increase, while personal income surged by 1.0%, exceeding the expected 0.4%. Meanwhile, US Jan pending home sales fell by 4.9% MoM, below expectations and the largest drop in 5 months
• Global bond yields move lower on Thursday; The German bund 10-yr yield fell by -4.7 bps to 2.41%, and the UK gilt 10-yr yield tumbled by -6.1 bps to 4.12%. The Japanese JGB 10-yr yield rose by +0.71 bps to 0.90%.
Domestic Market Updates
• Indonesian benchmark series of LCY government bonds closed lower on Thursday (Feb 29, 2024), with the 10-yr benchmark yield rose +0.36 bps to 6.59%, while 2-yr yield fell -1.21 bps to 6.19%.
• Meanwhile, the IDR depreciated against the USD (USD/IDR rose by +0.19% to 15,715) at Thursday’s close. The Rupiah has continued to weaken for five consecutive days, in contrast to other ASEAN currencies, including JPY, SGD and THB, which appreciated against the USD.
• DJPPR MoF will launch SR020 today in two series, namely SR020-T3 with a three-year tenor and a coupon of 6.3%, and SR020-T5 with a five-year tenor and a coupon of 6.4% per annum.
• The liquidity of the economy, or broad money (M2), grew higher in January 2024. The M2 position in January 2024 amounted to IDR8,721.9tn, a growth of 5.4% YoY, higher than the previous month's growth of 3.5% YoY.
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 6.50-6.65% for today.
• Attractive Indo GB series to be traded today : FR0081, FR0099, FR0071, FR00101, FR0075, FR0083, FR0097.
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