04 Desember 2023
Fixed Income Report December 4, 2023
Global Market Updates
• Wall Street equities rallied Friday (Dec 1, 2023), DJI closed up +0.82%, S&P 500 rose +0.59%, and Nasdaq closed down +0.31%.
• Stocks rose on Friday, surging after the US Nov-23 ISM manufacturing index came in lower than expected at 46.7, below the anticipated 47.8. Stocks rallied despite Fed Chair Powell's caution against premature speculation on the timing of interest rate cuts.
• US Treasury 10-yr yields tumbled -10.0 bps to 4.22%, followed by shorter-termed UST 2-yr yield that rose -2.3 bps to 4.56%.
• 10-yr yields closed lower on Friday as stocks rallied, prompted by Fed Chair Powell’s signaled that the Fed intends to maintain steady interest rates during the Dec 12-13 FOMC meeting.
• The US Nov-23 ISM manufacturing index remained stagnant at 46.7, falling short of the anticipated rise to 47.8, marking the 13th consecutive month of manufacturing activity contraction, while US Oct-23 construction spending rose +0.6% MoM, exceeding the expected rise of +0.3% MoM.
• Global bond yields friday moved lower; the German bund 10-yr yield fell -8.5 bps to 2.36%, the UK gilt 10-yr yield slipped -3.6 bps to 4.14%. The Japanese GB 10-yr yield closed down +2.50 bps to 0.70%.
Domestic Market Updates
• Indonesian benchmark series of LCY government bonds closed higher Friday (Dec 1, 2023), as the 10-yr benchmark yield closed down -0.95 bps to 6.60%.
• IDR strengthened against the USD (USD/IDR fell -0.25% to 15,485) Friday. IDR supported by the influx of foreign funds into the financial markets, amidst Indonesia's commencement of a grand campaign for the 2024 general and presidential elections.
• The Central Bureau Statistic (BPS) released Indonesian inflation for Nov-23 which reached 0.38% MoM/+2.86% YoY higher than the previous month's 0.17% MoM/+2.56% YoY.
• In Friday’s Indo GB series trading, FR80 and FR96 emerged as leaders in the bond market, boasting trading volumes of IDR0.85tn and IDR1.48tn, respectively. Furthermore, the most actively traded were FR89 and FR97.
• Indonesia CPI Nov-23 increased 116.08 points from 115.64 points in Oct-23. The records reaching all time high of 115.64 points in Oct-23.
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
