Rebalancing & Rotation Start Early
Key Takeaways
• Starting 2023, the main story in the global financial market is dictated by rebalancing and rotation.
• Recent development : 1) rebalancing to China as growth prospect improved by easing pandemic curb measures reflected with USD4.9bn inflows to China; 2) foreign investors favor Indo GB and 3) sector rotation comes driven by risk and return opportunity in safer asset and cheaper valuation.
• Expect JCI correction to be shallow, with the bottom possibly at 6,406- 6,571 assuming JCI earnings yield – Indo GB yield spread at 100-120 bps given the likelihood of moderating EPS growth.
• Stock to benefit from recent trend : 1) ANTM; 2) ARTO; 3) BFIN; 4) EXCL; 5) GOTO; 6) ICBP.
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