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Kamis, 29 Mei 2014

Morning Dew - 29 May 2014

CAD May Widen

Amidst the public holiday-dotted week, the Finance Minister Chatib Basri said that Current Account Deficit (CAD) for the 2Q14 may widen as imports increased due to business expansion. CAD has been traditionally worsening in second quarter, followed by improving current account position in the third and fourth quarter. 

Currently the CAD is expected to be held at 3% of GDP this year. Indonesia’s CAD climbed to its peak in 2Q13 when the amount hit US$10.1bn or 4.4% of GDP.
Foreign Exchange Reserves is expected to be stable throughout the remainder of the year, according to Bank Indonesia. By the end of April 2014, the reserves amounted to US$105.6bn.

Industry Ministry reported a 5.56% growth in non-oil & gas industry in the first quarter 2014, outpacing the GDP which turned out to be slowing down to 5.21% in 1Q14. Strong growth were evident in F&B Processing, Transportation Equipment, Machinery & Equipment, and Farming & Plantation industries. This year the ministry aims at 6.5% growth.

USDIDR fell slightly on Thursday to 11,613 from 11,633.

U.S. Economy Shrunk

US GDP fell 1% in 1Q14, worse than the consensus take which forecast a 0.5% contraction and also weaker than prior quarter’s slight growth of 0.1%.

US initial jobless claims fell to 300k from 327k, better than the consensus figure of 318k.

US pending home sales slowed from 3.4% seen in March on month-on-month basis. Against the same month last year, sales fell 9.4% in April after 7.5% drop in the prior month.

US Personal income and personal spending data are set for release on Friday.

Technically Speaking...

JCI continued to gyrate near the 5k resistance as the market is expected to remain subdued throughout the week.

Beyond the resistance at 5,063/93 the index will aim at 5,251 – the all-time high seen last year.

Support is seen at 4,900 and 4,868 in the short-term and 4,800 afterwards.
MACD and RSI flattened as market activity slowed. Volume is expected to be thin throughout the week due to holidays on Tuesday and Thursday.

No additional recommendation for now, and at the moment a total of seven recommendations are active and all of them are holding on.

Day Ahead

Market is set to open on Friday, but as the week has been cut short by public holidays, trading maybe subdued on Friday. Lack of fresh catalysts may dampen trading volume. Positive Dow overnight may help support sentiment however, but still upside is seen limited.

Diposting oleh di 14.52
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