01 Desember 2023
Fixed Income Report December 1, 2023
Global Market Updates
• Wall Street equities showed slight gains Thursday (Nov 30, 2023), DJI closed up +1.47%, S&P 500 rose +0.38%, and Nasdaq closed down -0.25%.
• Stocks on Thursday initially moved higher before closing mixed, Initial support for stocks came from U.S. economic reports showing that continuing unemployment claims reached a 2-year high, and the Oct-23 core PCE rose less than expected supporting expectations that the Fed will halt interest rates hikes and strengthening the outlook for an economic soft landing.
• US Treasury 10-yr yields gained +10.0 bps to 4.37%, followed by shorter-termed UST 2-yr yield that rose +9 bps to 4.73%.
• 10-yr yields pushed higher and weighed on technology stocks after hawkish comments from Fed William and Fed Daly lowered expectations the Fed would soon lower interest rates.
• China’s manufacturing PMI on Nov-23 unexpectedly fell -0.1 to a 4-month low of 49.4, below forecasts of a rise to 49.8. Additionally, the Nov -23 non-manufacturing PMI unexpectedly dropped by -0.4 to 50.2, an 11-month low, below forecasts of 50.9.
• Global bond yields Thursday moved lower; the German bund 10-yr yield rose +1.5 bps to 2.44%, the UK gilt 10-yr yield climbed +8.0 bps to 4.17%. The Japanese GB 10-yr yield closed slipped -8.60 bps to 0.67%.
Domestic Market Updates
• Indonesian benchmark series of LCY government bonds closed higher Thursday (Nov 30, 2023), as the 10-yr benchmark yield closed down -8.14 bps to 6.59%.
• IDR closed weaker against the USD (USD/IDR rose +0.75% to 15,510) Thursday. IDR weakened against the USD after the Bank Indonesia (PTBI) annual meeting and pressure on the US dollar index which continue rose 103.50 or strengthened 0.64% compared to the previous day.
• In Thursday’s Indo GB series trading, again FR98 and FR101 emerged as leaders in the bond market, boasting trading volumes of IDR1.16tn and IDR1.59tn, respectively. Furthermore, the most actively traded were FR95, FR98 and FR100.
• BI release shows that the M2 position in Oct-23 was recorded at IDR 8,50tn or grew 3.4%YoY, after growing 6.0%YoY in the previous month, while M1 grew 0.1%YoY in Oct-23, slowing compared to growth of 4.1%YoY in the previous month
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 6.50-6.70% for today.
Attractive Indo GB series to be traded today : FR0040, FR0081, FR0096, FR0100.
Disclaimer On
FR40
FR81
FR96
FR100
