STORY OF THE DAY

We believe equity markets can overcome the seasonally volatile 3Q to finish the year on a better note if inflation cools further, The Fed stops hiking rates, and China’s recovery resumes.

2 developments to watch.

WHAT DOES THIS MEAN FOR YOUR PORTFOLIO

We are watching two investment themes:

1. El Niño is back with warmer and drier weather expected over the rest of the year; and
2. AI is breathing new life to the tech recovery. Beyond these, turning to Indonesia’s market, we expect a more favourable environment in the second half of 2023 as external pressures recede and domestic inflationary pressures ease.

WE LIKE THESE

More favourable 2H23 for Indonesia 

DBS Group Research believes there are 3 key themes for investors to watch: 

• A more resilient domestic economy
• Election-spending proxies
• El Niño beneficiaries 

Entering the second semester of 2023, when external pressures (increasing global central bank interest rates) have become clearer in their direction and domestically related to the rupiah exchange rate and inflation being maintained within the scope set by Bank Indonesia, this will make the Indonesian financial market attractive and encourage foreign investor funds to flow back in. 

Below are some products to consider. 

IDR and USD Government Bonds

With the potential for the global interest rate increase cycle to end and global economic growth potentially slowing, investors tend to look for investment instruments that provide attractive returns. Bonds with high liquidity and yield and issued by countries with good economic growth and investment grade ratings are attractive to invest in.

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DISCLAIMER

This publication is distributed by PT Bank DBS Indonesia (DBSI). DBSI is licensed and supervised by the Indonesia Financial Services Authority (OJK) and a member of the Indonesia Deposit Insurance Corporation (LPS). This publication is not and does not constitute or form part of any offer, recommendation, invitation or solicitation to you to subscribe to or to enter into any transaction as described, nor is it calculated to invite or permit the making of offers to the public to subscribe to or enter into any transaction for cash or other consideration and should not be viewed as such.