Global Market Update
• The benchmark 10-year note yield was flat at 3.45% on Friday (09/16/22)
• On the other hand, the 2-year benchmark was also flat at 3.87% at the same time.
• Spread between 2/10-year UST note yield was at -42 bps or did not change from the previous day position.
• However yield on the benchmark government bonds have increased by 14 bps (10-year UST note) & 31 bps (2-year UST note) from the previous week.
• US stock indices fell on Friday. The DJI fell 0.45%; S&P 500 dropped 0.72% whilst Nasdaq Composite came at worst with 0.90% decline.
• US stock indices lost more than 4% of their market capitalization a week ago.
• Market still expect that on Sep-22 FOMC meeting, another 75 bps hikes would be taken with 80% probability, bringing FFR to 300-325 bps.
Domestic Market Update
• The benchmark 10-year Indo GB yield (FR0091) increased 3 bps to 7.19% on Friday (09/16/22).
• The benchmark government bond yield moved in a range of 7.00-7.20% last week, in-line with our projection.
• Indonesia’s 5-year CDS moved within the range of 100-110 bps this week and closed at 110.78 on Friday last week.
• However, the IDR slightly depreciated against USD. The IDR was closed at IDR14,955/USD on Friday (vs IDR14,898/USD on Thursday).
• Domestic stock market also recorded an outflows on the last trading day in the previous week.
• JCI dropped by 1.87% after hitting its All Time High level previously.
Market Projection
• Given the recent development on global and domestic market, we expect the 10 year Indo GB yield to move within a range of 7.10-7.30% for today.
• Attractive Indo GB series to be traded today : FR0063, FR0070, FR0077, FR0081, FR0086, FR0090, FR0064, FR0082, FR0087, FR0091, FR0096.
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