Weekly Market Review (30 Jan) - What happened & What's next?
- JCI went up by 1.1% to 5,312.8, with foreign started buying (US$54.6m) after 3 weeks outflow. Regional market were also supportive after Trump inauguration, with Dow Jones rose 1.3%. Meanwhile, on sector basis, Infrastructure sector took the lead (+1.7%), after underperforming for couple of weeks. In contrast, property was the laggard (-0.7%), as marketing sales was still slow. News to be watched this week are US FOMC meeting and domestic monthly inflation data.
- IDR was appreciated by 0.4%, in line with US$ movement which depreciated against major currency by 0.2%.
- 10-year US treasury yield was up about 8bps from 2.41% this week to 2.49%. It reached 2.55% on Thursday. The U.S. economy grew at a 1.9% annualized rate last quarter, less than analysts projected.
- Based on bond ownership data from DJPPR as of January 26, foreign net buy of 2.91 Tn in Government bonds, foreign ownership increased from 37.82% to 37.85% last week.
- By the end of last week, 10 year Indonesia bond yield was increased from 7.50% to 7.61%. It was driven by Trump administration’s steps to boost U.S. economic growth. Last week bond market transaction was relatively low, as shown by lower than average trading volume of Rp 8.31 T, lower than YTD average of 12.43 T.
- US economy grew by 1.9% in fourth quarter in 2016, lower than 2.2% of consensus estimate. Weaker than expected data was attributable to disappointed export and import numbers. Worth noting, President Trump promised to lift GDP to 4% by cutting tax and boost infrastructure spending
- One of Chinese Province, Liaoning, admit faking its economic data from 2011 to 2014, inflating government revenues by 20%. Liaoning is one of industrial province in North Eastern China
- Hippindo, Indonesia Shopping Centres Tenants Association, expects FMCG sales to increase by 10%yoy this year, versus last year estimate of 8%.
- Government plans to apply new progressive tax for idle land. However, the definition of the idle land is still unclear so far.
- Bank Indonesia expects inflation to reach 0.69% MoM due to price increase in electricity and STNK. We think that economists have already taken account some of those two factors in their estimate.
Foreign net purchases of Asian equities