Company Update

03 Mei 2024

Fixed Income Report May 3, 2024

Global Market Updates   
• Wall Street equities recovered on May 2, with the DJI up by +0.85%, the S&P 500 rose by +0.91%, and the Nasdaq closed up by +1.51%. 
• US stocks closed moderately higher on Thursday, buoyed by chip stocks after a +9% surge in Qualcomm. The broader market also received support from Fed Chair Powell's remarks suggesting no imminent interest rate hikes. Additionally, stocks received a boost as the OECD upgraded its 2024 global growth forecast to +3.1% from +2.9% in February, citing more balanced risks.
• US Treasury 10-yr yields declined by -5.0 bps to 4.58%, while 2-yr yields dropped by -9.0 bps to 4.87%. Powell’s remarks eased concerns over rising yields, leading to 12 bps drop in the 10-yr Treasury yield over the last two trading sessions, marking its lowest level in three weeks.
• Weekly US initial unemployment claims remained unchanged at 208,000, defying expectations of an increase to 211,000, signaling continued strength in the labor market.
• In Q1, US nonfarm productivity increased by +0.3%, falling short of expectations for a +0.5% rise. Meanwhile, Q1 unit labor costs rose by +4.7%, surpassing expectations for a +4.0% increase.
• In Asia, The Hong Kong Monetary Authority (HKMA) held its base rate steady at 5.75% on May 2nd, shortly after the US Federal Reserve decided to keep its key interest rate unchanged.
• Global bond yields were mixed on Wednesday; The German bund yield fell by -4.2 bps to 2.54%, while the UK 10-yr gilt yield slid by -8.0 bps to 4.29% and the Japanese 10-yr JGB yield rose by +1.00 bps to 0.90%.
Domestic Market Updates
• Indonesian benchmark series of LCY government bonds closed higher on May 2, with the 10-yr benchmark yield  declined by -5.58 bps to 7.16%.
• The IDR appreciated against the USD at Thursday’s close (USD/IDR fell by -0.46% to 16,185), after the Fed kept its benchmark interest rate unchanged, as expected. Additionally, Indonesia's inflation in April 2024 experienced a slight decrease compared to March 2024.
• BPS reported that inflation in April 2024 reached +0.25% MoM (+3.00% YoY), lower than the previous month’s +0.52% MoM (+3.05% YoY). Meanwhile, core inflation was recorded at +0.29% MoM (+1.82% YoY), higher than the previous month's +0.23% MoM (+1.77% YoY). This uptick aligns with the seasonal surge in demand during the Eid Fitr period and the upward trend in global commodity prices.
• In Thursday's Indo-GB series trading, FR0100 and FR0101 attracted significant interest in outright transactions, with the highest trade volumes of IDR9.61tn and IDR5.53tn, respectively. Furthermore, FR0100, FR0081, and FR0101 saw 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 7.05-7.25% for today.
• Attractive Indo GB series to be traded today : FR0081, FR0059, FR0095, FR0082, FR0096, FR0100. 
Disclaimer On

FR81 FR59 FR95 FR82 FR96 FR0100

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