Positive Sentiment Boosts S&P 500 +3.48%

The United States stock market S&P 500 closed up +3.48% during last week's trading. This increase shows the best performance of the S&P 500 index since early November. Last week's sentiment was supported by several factors: (i) fear in the financial sector began to subside because there was no new news regarding the banking crisis; (ii) buyback of Growth Stocks shares such as those in the consumer discretionary and technology sectors; (iii) the release of economic data that strengthens the possibility for the Fed to stop increasing interest rates.

After financial regulators took steps to stem the impact of the worst banking crisis since 2008, investors' focus returned to the direction of the Fed's interest rates. Market participants are optimistic that the Fed will eventually stop raising interest rates, supported by economic data in the form of a rise in weekly unemployment along with a moderation in the March personal consumption expenditure index, supporting the possibility of ending the rate hike soon. All S&P 500 sectors closed green in trading last week, with the highest increase in the Energy sector at +6.1%, and Consumer Discretionary at +5.5%.

Indonesia's PMI Improves in March 2023

Indonesia's Purchasing Managers Index (PMI) rose to 51.9 in March 2023, from 51.2 in the previous month. This figure represents the 19th consecutive month of growth in factory activity. Improved domestic demand conditions cause production to increase, which results in increased purchases of raw materials and recruitment of staff. New export orders tend to decline amid weaker market conditions abroad, but the decline is milder compared to last February. Supply constraints have begun to ease for Indonesian producers with shorter lead times supported by better transportation performance and easing supply shortages.

2023 Personal Tax Reporting Compliance Increases

The personal tax reporting compliance ratio for 2023 rose to 66.69%, higher than the previous year of 64.32%. This increase in compliance was also accompanied by an increase in the number of individual taxpayers reporting by 4.65% to 11.68 million people, up from 11.16 million people in the previous year. However, this figure is still much lower than the Ministry of Finance's target of 16.11 million taxpayers with a target compliance level of 83%.

Key Takeaways:

The United States stock market increased by +3.48% supported by several positive sentiments. (i) fear in the financial sector is starting to subside because there is no new news regarding the banking crisis; (ii) buyback of Growth Stocks shares such as those in the consumer discretionary and technology sectors; (iii) the release of economic data that strengthens the possibility for the Fed to stop increasing interest rates.

For the domestic economy, Indonesia's Purchasing Managers Index (PMI) has improved again for 19 consecutive months. The PMI level in March 2023 was at 51.9, up from 51.2 in February 2023.

Improved domestic demand conditions cause production to increase. New export orders tend to decline amid weaker market conditions overseas.

In other economic news, personal tax reporting compliance for 2023 rose to 66.69%, or 11.68 million people, higher than the previous year's 64.32%. However, this figure is still much lower than the Ministry of Finance's target of 16.11 million taxpayers with a target compliance level of 83%.

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