Morning Dew - 21 February 2014

Still on Track

JCI is on its track to hit 4,600 as the index continued to grind higher to hit the intraday high at 4598.

Some positive catalysts recently released were the improving CAD (hence lessened the odds that BI will raise rate again), the improving IDR, Bank of Japan’s continued stimulus, and Fed’s Janet Yellen’s statement that the tapering policy will continue on.

US consumer inflation data showed inflation was up 1.6% in January (yoy), core inflation was up 1.6% (yoy) as well. Jobless claims declined to 336k from 339k.

USDIDR fell from 11,850 to 11,772 per USD.

JSMR & SMBR

The toll road operator JSMR reported its net profit falling 16.59% in 2013, despite the revenue went up 13.50%. Assets and liability gained 14.6% and 16.93%, respectively. Rising various expenses and finance charges were behind the declining profit as revenues cannot keep up.

SMBR’s net profit inched 4.58% higher in 2013 while its revenue advanced 6.46%. Assets jumped 126.22% but liability almost unchanged throughout 2013. SMBR went public just last year.

Technically Speaking...

JCI continued to struggle to break its resistance area around 4,610 as the Thursday’s peak hit 4,598.

Recent peak-turned-support at 4,510 will be nearest support line for JCI, whereas the 200-day EMA at 4,440 will be the subsequent support area. 

Nearest resistance is seen at around 4,610 while 4,791 will be the next hurdle to crack should 4,610 gives way.

Volume was up while MACD continued to push up, maintaining the upside potential at the moment. For now, the outlook is biased to the upside although recent gains could spell a near-term correction.

Day Ahead

There’s still no key catalysts expected this Friday. From the US, only existing home sales will be released, but the data is hardly a market-mover. Hence, the JCI is likely to continue to creep up on the back of FY2013 earnings releases. As the Dow gained overnight, the JCI is biased to the upside as well.

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