Morning Brief
Daily | Jan 24, 2019
JCI closed lower yesterday because of the bank sector's worse performance and the discontinued net foreign buy. BoJ's stance of lower inflation hampered JCI.
Top Losers: Finance (-1.09%), Consumer (-0.32%), Infrastructure (-0.14%)
Daily Foreign & Domestic Sector Movement
Foreign investors posted the net sell of IDR142 billion. Although the amount was relatively small, they started to be cautious of Indonesia's market. The banking sector still has the biggest contribution to the foreign net sell.
Foreign investors digest the outlook of global economic growth, while domestic investors post the net sell of IDR73 billion on the cigarette sector. We estimate the domestic net sell was triggered by "reduce" recommendation issued by CIMB with HMSP's target price of IDR2.800. That results in investors' concerns about HMSP recommendation.
Today’s Outlook: Investors Banks on BI's Stimulus
We estimate that today JCI moves sideways with the support range of 6380
-6420 and the resistance range of 6500-6550. Investors will keep their wary eyes
on Bank Indonesia (BI)'s governor statement of the economic outlook and BI's 7 -days Reverse Repo Rate. BI considers that its benchmark rate is at the highest point because the Fed has slowed its rate down. Meanwhile, trade deficits are estimated to settle at 2.5% of GDP compared to the 2018 figure of 3%. In addition, GDP is expected to grow by 5%-5.4% in 2019. BI oversees that the rupiah is currently undervalued.
Company News
BBNI : Allocates IDR1.6 Trillion for Technology BBTN : Targets Growth of 13% in Construction Credit KLBF : Increases Variant of Prescription Drugs PTBA : Targets Production Volume of 27.3 Million Tons
Domestic & Global News
Company News
Domestic & Global News
The Government's Debt Hits IDR4,418 Trillion
For most of 2018, the central government's debt amounted to IDR4,418.3 trillion. That total debt increased by IDR423.05 trillion, compared to the 2017 figure of IDR3,995.25 trillion. The state budget (APBN) data released by the Finance Ministry showed that the central government's debt consisted of loans and government bonds. The government total loan edged up by 8.8% y-y, from IDR740.54 trillion to IDR805.62 trillion. Meanwhile, the government's foreign debt soared by 154% y -y to IDR799.04 trillion. On the contrar-y, the domestic loan depleted b-y 99.8% -y-y to only at IDR6.57 trillion. (Kontan)
Beijing Will Boost Fiscal Expenditure in 2019
China will step up fiscal spending this year to support its economy, focusing on further cuts in taxes and fees for small firms, finance ministry officials said on Wednesday. Mounting pressure on the world’s second-biggest economy pushed growth last year to its lowest since 1990 even as Beijing stepped up stimulus measures and spurred banks to lend more. China’s fiscal spending rose 8.7 percent to 22.1 trillion yuan ($3.3 trillion) in 2018, while revenue increased 6.2 percent to 18.3 trillion yuan, China achieved its 2018 fiscal revenue target despite extensive tax cuts last year. (CNBC)
BBNI : Allocates IDR1.6 Trillion for Technology
BBNI expands its technology further. In 2019, it ploughs IDR1.6 trillion into the development of new digital banking products and features. Furthermore, it allocates IDR3-4 trillion for taking over a financial technology company. In addition, BBNI cooperates with 3 other banks will release QR Code technology, LinkAja, in February-March 2019. (Kontan)
BBTN : Targets Growth of 13% in Construction Credit
BBTN targets the credit distributed to the construction segment to grow above 13% in 2019. The 2018 credit grew by 12% y-y; thus, it will focus on developing the middle and low-to-middle class housing construction segment, the greater Jakarta-based TOD project developed by other state-owned enterprises (BUMN), and the program of one million houses. (Kontan)
KLBF : Increases Variant of Prescription Drugs
KLBF is committed to increasing variant of its prescription drugs, nutrition, and health supplements with a view to spurring its organic growth. In 2019, it allocates the capex of IDR1-1.5 trillion to construct an over-the-counter factory in Cikarang and a prescription-drug factory in Pulo Gadung, East Jakarta. Of note, it targets the minimum growth of 4%-5% in 2019. (Bisnis Indonesia)
PTBA : Targets Production Volume of 27.3 Million
Tons
Global Economic Calendar
Source: Bloomberg
Date Country Jakarta Hour Event Period Actual Consensus Previous
Monday CHN 09:00 Industrial Production YoY Dec 5.70% 5.30% 5.40%
21- Jan CHN 09:00 GDP YoY 4Q 6.40% 0.064 0.065
Tuesday USA Tentative Trade Balance Nov -$54.0b -$55.5b
22 - Jan USA Tentative Factory Orders Nov 0.30% -2.10%
USA Tentative Housing Starts Dec 1252k 1256k
USA Tentative New Home Sales Nov 567k 544k
USA Tentative Retail Sales Advance MoM Dec 0.001 0.002 USA Tentative Durable Goods Orders Nov F 0.80% 0.80% UK 16:30 Claimant Count Rate Dec 2.80% -- 0.028 UK 16:30 ILO Unemployment Rate 3Mths Nov 4.00% 4.10% 4.10% UK 16:30 Jobless Claims Change Dec 20.8k -- 21.9k GER 17:00 ZEW Survey Current Situation Jan 27.6 42.8 45.3 GER 17:00 ZEW Survey Expectations Jan -15.0 -18.8 -17.5 USA 22:00 Existing Home Sales Dec 4.99m 5.27m 5.32m USA Tentative Wholesale Inventories MoM Nov P 0.50% 0.80%
Wednesday USA 19:00 MBA Mortgage Applications 18-Jan -2.70% -- 13.50%
23 - Jan USA Tentative Wholesale Inventories MoM Nov F 0.005 --
Thursday JPN 07:30 Nikkei Japan PMI Mfg Jan P 50.0 -- 52.6
24 - Jan GER 15:30
Markit/BME Germany Manufacturing
PMI Jan P 5110.00% 5150.00%
EU 16:00 Markit Eurozone Manufacturing PMI Jan P 5130.00% 5140.00% EU 19:45 ECB Deposit Facility Rate 24-Jan -0.40% -0.40% EU 19:45 ECB Main Refinancing Rate 24-Jan 0 0 USA 20:30 Initial Jobless Claims 19-Jan -- 213k USA 21:45 Markit US Manufacturing PMI Jan P -- 5380.00%
USA 22:00 Leading Index Dec -0.001 0.002
Friday JPN 06:30 Tokyo CPI Ex-Fresh Food YoY Jan 0.90% 0.90%
25 - Jan GER 16:00 IFO Business Climate Jan 100.5 101
USA 20:30 Durable Goods Orders Dec P -- --
USA 22:00 New Home Sales Dec -- --
Corporate Calendar
Date Event Company
Monday Extraordinary Shareholder Meeting ITTG
21- Jan
Wednesday Rights Offerings SQMI
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