Mandiri Sekuritas

According to PLTE data, foreign inflows are still coming to the INDOGB market on Wednesday, totaling Rp631bn – mostly from benchmark series, reaching Rp581bn. Trading volume in the secondary market was reported at Rp12.2tn. Foreign ownership in government bond based on settlement date as of 25 Sept has continued to increase to Rp844.7tn (still outflow of Rp11.1tn mtd but inflow of Rp8.5tn ytd) or 37% of total outstanding.

The benchmark bond series were mixed with the 5yr-FR63 trading at 90.4 (+0.1%), yielding 8.16% (-2 bps); the 10yr-FR64 at 86.4 (+0.1%), yielding 8.19% (-1.7 bps); the 15yr-FR65 flat at 85.4, yielding 8.37% (+0.4 bps); and the 20yr-FR75 at 89.2% (-0.1%), yielding 8.65 (+0.8 bps).

JCI fell 0.02% to 5,873.3 (-2.4% mtd or -7.6% ytd) with foreign investors keep giving net inflows reaching Rp233.5bn (outflow of Rp2tn mtd or -Rp52tn ytd). Meanwhile, rupiah appreciated slightly by 0.06% to Rp14,911/USD (depreciated 1.2% mtd or -9.9% ytd) on Wednesday.

On the global market, as expected, the Fed increased FFR by 25 bps to 2.25% on the September meeting. Quantitative tightening stepped up to max plan at USD50bn per month and the Fed has also removed the description of monetary policy stance as "accommodative". Dot plot is still the same; expect one more increase for the rest of this year and three more next year (vs. Implied fed fund futures expected only two rates hikes in 2019). After FOMC meeting, US stocks closed lower, DXY flat, and US Treasury yields fell. Dow Jones decreased by 0.26% to 26,492.2 and S&P 500 fell 0.13% to 2,915.6. Meanwhile, the UST 10-year yield shed 4 bps to 3.06% and the two-year yield was unchanged at 2.83%. (Source: Mandiri Sekuritas)

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