JAKARTA (TheInsiderStories) – Good Morning! The first major data release out of China since the coronavirus outbreak out this week, with the February update of the government sponsored NBS manufacturing PMI. China is slowly getting back to normal, fears over the economic fallout from the spread of coronavirus beyond its borders remain to the fore.
As with all manufacturing PMIs at times of supply shocks, as the latter is likely to be buoyed by longer delivery delays, giving a false reading of health. Other key data releases out of Asia Pacific include gross domestic products (GDP) data for Hong Kong SAR and India, plus a number of Asian trade and industrial output updates, notably for Japan.
However, all will cover periods prior to the virus outbreak. Policy action will meanwhile come from the Bank of Korea while speeches by Bank of Japan policy board members will be watched for clues of future policy moves. The selloff in the Yen, marks a departure from the pattern in recent years where the Japanese currency rises in times of geopolitical or market turmoil due to Japan’s status as the world’s largest creditor nation.
A fresh estimate of fourth quarter 2019 GDP will also be available, with expectations that the annualized growth will have remained unchanged at 2.1 percent. German GDP data for the fourth quarter are also updated and will be eyed for signs of any potential (though unexpected) downward revision into contraction territory.
European Central Bank watchers will meanwhile be keen to see the flash official consumer price inflation numbers. The president, Christine Lagarde is due to deliver remarks at an event in Germany on Wednesday, while several other ECB officials, including Chief Economist Philip Lane will also give speeches this week
In the United States (US), economy’ relative resilience to coronavirus has made the greenback the safe-haven of choice, at least temporarily. The health of the US economy will be assessed from official data in durable goods orders as well as a clutch of regional Federal Reserve (Fed) surveys, albeit with the focus somewhat limited to manufacturing.
On Tuesday, Fed vice chairman Richard Clarida is to speak at an economic policy conference in Washington and Dallas Fed President Robert Kaplan are also set to make appearances this week, with investors on the lookout for any comments on the virus impact. Also on Tuesday, a report on US consumer confidence will be closely watched for any indications that the global coronavirus outbreak is hitting sentiment.
Thursday’ durable goods orders data is forecast to be weaker amid a slowdown in factory output in Asia, while the halting of Boeing (NYSE: BA) 737 Max production in mid-January is also likely to weigh. Meanwhile, the second reading of US fourth quarter growth is not expected to be subject to a major revision.
In Indonesia, coordinating minister for maritime and investment, Luhut Binsar Panjaitan have scheduled to lead the new capital meeting and the GSP horticulture meeting at his Office. While, coordinating minister for economic affairs, Airlangga Hartarto becoming a keynote speaker in one seminar and lead coordination meeting on housing, tourism and basic Food stimulus at the ministry office.
Last week, US stock markets slumped as investors took a defensive stance amid renewed concerns about the economic impact of the COVID-19. And, yields on 30-year bonds fell to a record low amid data showing US business activity is shrinking for the first time since 2013.
While, oil prices fell 0.9 percent as the spread of the coronavirus spread outside China. The local government is revising how to calculate the total infection for the third time this month, raising questions about the reliability of the data and ensuring the reach of the developing virus.
IHS Markit from factories and service providers in the world’ largest economy fell for the first time in seven years, triggering a sell-off in government bonds and equities.
Indonesia also anticipates the impact of the corona on trade and economic growth. The government announced plans to accelerate spending, and the central bank cut its benchmark rate and revised 2020 GDP in the range of 5.0 – 5.4 percent.
On Friday, Indonesian Rupiah closed down 0.07 percent to 13,760 over the Greenback and the Jakarta Composite Index (JCI) was corrected by 1.0 percent to 5,882.
Today, the local currency its expecting move in the range of 13,689 – 13,810 a US dollar and the stock index between 5,843 – 5,959. The analysts rated external sentiment could depressed both instruments.
The main factor that the market is concerned about is the economic impact of the spread of the coronavirus in a number of countries such as China, Japan and South Korea. The number of COVID-19 cases worldwide reached 76,215 cases with 2,247 fatalities. This virus has also spread to 28 countries and created a global panic.
The stocks to be watch for today are PT Wijaya Karya Tbk (IDX: WIKA), PT Mitra Adiperkasa Tbk (IDX: MAPI), PT Bank Tabungan Negara Tbk (IDX: BBTN), PT Bank Central Asia Tbk (IDX: BBCA), PT Vale Indonesia Tbk (IDX: INCO), PT Medco Energy Internation Tbk (IDX: MEDC), PT Telkom Indonesia Tbk (IDX: TLKM), PT Perusahaan Gas Negara Tbk (IDX: PGAS), and PT Charoen Pokphand Indonesia Tbk (IDX: CPIN).
May you have a profitable Week!
Written by Linda Silaen and TIS Intelligence Team, Please Read Our Insight to Get More information about Indonesia