Morning Dew - 9 October 2013

Key Points

• JCI gained 1.32% as Bank Indonesia held the interest rate unchanged at 7.25%. Deposit facility rate (FASBI) and the lending facility rates were also held at 5.5% and 7.25%, respectively. On another front, FX reserves gained 3% in September to $96b as BI measures seemed to have paid off to improve the reserves level. From China, HSBC/Markit PMI data for China's service sector saw the gauge fell from 52.8 to 52.4 in September, but it's still holding above the 50, which marks expansion. 
• Technically, JCI managed to pop above its 50-day EMA to hit 4439.72 before it settled the day at 4432.51. However, it remains to be seen whether Tuesday's rally can be sustained on Wednesday. Next resistance lies around 4545 where 100 and 200-day EMA curves intertwine. Support will be 4357 at the nearest and 4313/4314 double bottom afterwards. Falling Dow points at the risk JCI breaking through the downside support this mid-week. If so, the next layer of support will be at 4207.
• Washington remains a major concern for investors around the world as we are approaching Oct 17th when the US will be hitting its debt ceiling and starts to run out money to pay for its obligations. The consequences of such event is dire and this issue will keep regionals as well as JCI's rally in check, at least until the matter is resolved.
• LCGP, MDLN, and PGAS continue to stay in the green while ARNA, MLPL, AISA and ACES remain stuck in the red. There is no changes in view as well as no new entries to the recommendation pool.

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