Ahead of the US Interest Rate Decision, JCI Opens Up

Armfalcon.com, JAKARTA — The Composite Stock Price Index (IHSG) opened positively on trading Tuesday (2/5/2023). JCI strengthened to a level of 6,920.33 after closing down last weekend’s trading.

Phillip Sekuritas Indonesia estimates that the JCI has the potential to increase today in line with the movement of the majority of indices in Asia this morning. “Share indices in Asia opened higher ahead of the decision on the benchmark interest rate by the Australian Central Bank (RBA),” said Phillip Sekuritas Indonesia in his research, Tuesday (2/5/2023).

Meanwhile, the main stock indexes on Wall Street closed slightly down last night amid the strengthening US dollar exchange rate and rising bond yields. The Nasdaq corrected 0.13 percent, while the DJI and S&P500 advanced.

Ahead of the decision on the benchmark interest rate by the US central bank, the Federal Reserve, next Wednesday, the yield on the 10-year US government bonds jumped nearly 11 bps to 3.56 percent. Meanwhile, the yield of two-year bonds rose seven bps to 4.13 percent

The release of US economic data last night strengthened expectations that the Federal Reserve will raise interest rates by 25 bps. Thus, the Federal Funds Rate (FFR) will be in the range of 5.00-5.25 percent, the highest since 2007.

For this week apart from the interest rate decision by the Federal Reserve, investors are also looking forward to the release of a number of important US economic data, particularly the Non-Farm Payrolls (NFP) on Friday.

Investors have not reacted too negatively to JPMorgan Chase’s acquisition of First Republic bank. As is known, regulators in the US, in this case the Federal Deposit Insurance Corporation (FDIC) took over First Republic bank Monday morning and sold most of First Republic bank operations to JPMorgan Chase.

JPMorgan Chase, the largest US bank, agreed to take over First Republic for US$173 billion in assets, US$30 billion in securities and all of First Republic’s US$92 billion in Third Party Funds (DPK).

The FDIC also agreed to jointly bear losses on a number of mortgages and loans, thus giving JPMorgan Chase some protection if it turns out that the price of the assets purchased has fallen sharply.

Phillip Sekuritas Indonesia recommends a number of shares to be traded today.

INCO

Short Term Trend : Bullish

Medium Term Trend : Bullish

Trading Buys : 6825

Target Price 1: 7400

Target Price 2 : 7650

Stop Loss : 6300

MMLP

Short Term Trend : Bullish

Medium Term Trend : Sideways

Trade Buys : 486

Target Price 1 : 515

Target Price 2 : 530

Stop Loss : 456

ADRO

Short Term Trend : Bullish

Medium Term Trend : Bearish

Trade Buy : 3130

Target Price 1 : 3440

Target Price 2 : 3620

Stop Loss : 2810

BNGA

Short Term Trend : Bullish

Medium Term Trend : Bullish

Trade Buy : 1240

Target Price 1 : 1305

Target Price 2 : 1320

Stop Loss : 1180