Company Update

13 Mei 2024

Fixed Income Report May 13, 2024

Global Market Updates    
• Wall Street equities closed mixed on May 10, as the DJI surged by +0.32%, the S&P 500 rose by +0.16%, and the Nasdaq edged down by -0.03%. 
• US stocks gained momentum on Friday, driven by chip stocks and upbeat Q1 earnings, expected to rise by +6.5% YoY, surpassing the pre-season estimate of +3.8%. However, higher T-note yields and a disappointing consumer sentiment report dampened the market, reflecting subdued sentiment and heightened inflation concerns.
• The 10-yr UST yields surged by +5.0 bps to 4.50%, while 2-yr yields jumped by +7.0 bps to 4.87%. T-note prices declined due to hawkish Fed remarks, rising US consumer inflation expectations, and reduced Fed rate cut expectations.
• The University of Michigan's preliminary May US consumer sentiment index dropped by -9.8 points to a six-month low of 67.4, falling below market expectations for a -1.0 point decline to 76.2.
• Meanwhile, The University of Michigan’s May US 1-year inflation expectation surged to +3.5% from April's 3.2%, surpassing expectations of remaining unchanged at 3.2%. Similarly, the May 5-10 year inflation expectation indicator rose to +3.1% from April's 3.0%.
• In Asia, China's consumer prices rose by +0.3% YoY in April 2024, surpassing both market estimates and March's figure, which saw a +0.1% increase. Conversely, producer prices declined by -2.5% YoY in April 2024, compared to market forecasts of a -2.3% fall and March's -2.8% decrease.
• Global bond yields were mixed on Friday, The German bund yield rose by +2.2 bps to 2.52%, while the 10-yr UK gilts yield increased by +2.4 bps to 4.16%. The Japanese 10-yr JGB yield closed down by -1.4 bps 0.86%.
Domestic Market Updates
• The Indonesian benchmark series of LCY government bonds closed lower on May 8, with the 10-yr benchmark yield rose by +2.06 bps to 6.92%, marking a spread of +242 bps from the UST 10-yr yield at 4,50%.
• The IDR weakened against the USD at Wednesday’s close (USD/IDR rose by +0.15% to 16,049), marking the last trading day of the week due to the long Ascension of Christ holiday.
• In April 2024, Indonesia's forex reserves dropped to USD136.2bn, down by -2.99% from March's USD140.4bn, driven by government foreign debt payments and the need to stabilize the rupiah’s currency. This decline marks the fourth consecutive months since December 2023.
• Based on transaction data from May 6 to May 7, 2024, non-residents recorded a net purchase of IDR4.04tn. This comprised a net purchase of IDR2.36tn in SBN, a net sale of IDR1.90tn in the stock market, and a net purchase of IDR3.58tn in SRBI.
• In Wednesday's Indo-GB series trading, tepid demand was observed in outright transactions, with FR098 and FR0100 garnered the highest trade volumes of IDR1.07tn and IDR0.941tn, respectively. Meanwhile, FR081, FR0100, and PBS038 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 6.85-7.10% for today.
• Attractive Indo GB series to be traded today : FR0081, FR0059, FR0064, FR0095, FR0091, FR0093. 
Disclaimer On

FR81 FR59 FR64 FR95 FR91 FR93

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