Headlines/Economic Data
General Trend: Equities see muted volatility amid Bitcoin Futures launch and ahead of a week filled with key global macro events, including Wed’s FOMC decision and US CPI
CBOE commented on Sunday’s launch of Bitcoin Futures: Said the opening price was $15,000 and 890 contracts were traded by 7:15 pm CT.
As of 9:10 PM CT, Front Month Bitcoin Futures had risen above $18,000 with over 1,600 contracts traded.
Japan
Nikkei 225 opened +0.4%; closed +0.6%
TOPIX Iron & Steel Index +0.6%
Construction company Obayashi -7% (speculated bid rigging allegations)
Chip-related names decline following Friday’s gains: SUMCO -2.5%, Tokyo Electron -2%
JAPAN Q4 BSI LARGE ALL INDUSTRY Q/Q: 6.2 V 5.8E; BSI LARGE MANUFACTURING Q/Q: 9.7 V 10.0E
Japan Govt is expected to upgrade its FY18 GDP forecast of 1.4% to ~2% with an expanding global economy seen boosting exports and capital investment expected to remain firm
Japan
(JP) Japan companies to receive more than 20% tax reductions if they raise wages – Nikkei
Looking Ahead: BoJ Q4 Tankan Survey due for release on Friday
Korea
Kospi opened +0.2%
Samsung Heavy, +1.5%: Expected to name new CEO after lower forecast – US financial press
Samsung Electronics -0.8%: Expected to hold its global strategy meeting starting from this week to share next year’s goals and strategies under the newly appointed chief executives – Korean press
Automakers decline, Hyundai Motor -5%, Kia Motors -2%: The companies said to target 2018 auto sales at 7.5M units vs 8.25M in 2017 – South Korean Press
Hyundai Motor Think Tank said automakers in South Korea face ‘major’ headwind from weakening Yen in 2018 – financial press
South Korea exports from Dec 1-10th -1.5% – Korean press
South Korea, US and Japan start missile tracking drill today; South Korea Military: No decision has been made on next year’s alliance exercise – Korean press
South Korea private think tank Korea Economic Research Institute (KERI): 52-hour workweek to cost businesses KRW2.3T in extra expenses annually due to Govt imposing a 52 hour working week limit – Korean press
(KR) South Korea sells KRW1.1T v KRW1.1T indicated in 10-year bonds: avg yield 2.495% v 2.595% prior
Bank of Korea (BOK) Sells KRW960B 1-yr monetary stabilization bonds at 1.82%
Bank of Korea (BOK) sells KRW800B v KRW900B indicated in 3-month monetary stabilization bonds; avg yield 1.56% v 1.54% prior
(KR) Hyundai Motor Think Tank said automakers in South Korea face ‘major’ headwind from weakening Yen in 2018 – financial press
China/Hong Kong
Shanghai Composite and Hang Seng opened flat
Hang Seng Energy Index +1.2%, Materials +1.1%, Financials +0.7%; Property Index -0.5%
(CN) China 10-year bond yield +3bps
(CN) China to implement new concepts in its 2018 economic work – financial press; To curb leverage ratio in 2018
(CN) PBoC sets yuan reference rate at 6.6152 v 6.6218 prior (1st stronger setting in 11-sessions)
(CN) PBOC Open Market Operations (OMO): injects CNY80B in 7 and 28-day reverse repos v skips prior; Net injections CNY20B
(CN) China Nov Fiscal Spending CNY1.66T, -9.1% y/y v -8.0% prior; Fiscal Rev CNY1.14T, -1.4% y/y v +5.4% prior
(CN) China should examine additional channels for direct financing; should protect interests of convertible bond holders – Chinese Press
(CN) China Banking Regulatory Commission (CBRC) indicates looking at increased rules for interbank asset transfers – China press
(CN) CHINA NOV CPI M/M: 0.0% V 0.1% PRIOR: Y/Y: 1.7% V 1.8%E; PPI Y/Y: 5.8% v 5.8%e; Food inflation: -1.1% (10th straight decline) v -0.4% prior
Looking Ahead: China Nov Fixed Assets Investment, Retail Sales and Industrial Production due to be released on Thursday.
Australia/New Zealand
ASX 200 opened +0.1%; closed +0.1%
(NZ) NEW ZEALAND NOV CARD SPENDING RETAIL M/M: 1.2% V 0.5%E; CARD SPENDING TOTAL M/M: 1.4% V 0.7% PRIOR
(NZ) RBNZ names Adrian Orr as next RBNZ Gov, effective March 27, 2018; Orr is well-known in the business community as the long-running chief executive of the New Zealand Superannuation Fund – NZ press; NZD/USD rises 0.9%
(NZ) NZIER: NZ Economists expect GDP growth averaging below 3% over the next five years; reiterates no urgency for RBNZ to raise rates
(AU) Australia buys back A$500M in 2018 and 2019 bonds
(AU) Australia sells A$500M v A$500M indicated in 3.00% March 2047 Bonds, avg yield 3.2948%, bid to cover 3.23x
TOX.AU Cleanaway to acquire Tox Free for A$3.425/shr cash for A$671M; To raise ~A$590M in a 1 for 3.65 entitlement offering priced at A$1.35/shr; +20%
AWE.AU Confirms all share offer from Mineral Resources at A$0.80/shr (1 new MRL share for each 22.325 AWE shares held); +16%
RFG.AU Series of investigative articles by Fairfax claiming a large number of RFG franchisees are suffering financial trouble and that wage fraud is systemic; -22%
Looking Ahead: Australia Nov NAB Business Confidence due to be released on Tuesday; RBA officials Lowe and Kent due to speak on Wed; Australia’s Nov Employment Data to be released on Thursday
Other Asia
Philippines Peso (PHP) gains over 0.3%: Fitch raised Philippines Sovereign Rating to BBB from BBB- (lowest level of investment grade)
Taiwan’s Hon Hai +3%; Reported Nov Rev +18.5% y/y
Indonesia, Malaysia and Thailand sign local currency FX settlement agreement
(IN) India govt to set up panel to decide on Bitcoin policy
(PH) Philippines sells PHP0B (nil) for 3-month, 6-month and 1-year bills (rejects all bids for second straight auction*)
North America
(US) US Senator Collins (R-ME) reiterates unsure if she will support final version of tax plan, wants to first see the bill – US Media
General Growth Properties (GGP): Said to reject ~$14.8B merger proposal from Brookfield, merger talks expected to continue – financial press
Looking Ahead: US Fed FOMC decision/economic forecasts and Nov CPI data due on Wed.
US Nov Retail Sales due for release on Thursday
Europe
(UK) Dec Rightmove House Prices m/m: -2.6% v -0.8% prior; y/y: 1.2% v 1.8% prior
(IE) Ireland Nov Construction PMI: 56.7 v 54.5 prior
BAE Systems [BA.UK]: Receives ~£5.0B order from Qatar for Typhoon aircraft
Man Group [EMG.UK]: To start quantitative hedge fund in China – financial press
Looking Ahead: ECB, SNB and BoE rate decisions due on Thursday, Dec 14th
Levels as of 01:00ET
Nikkei225 %, Hang Seng +0.7%; Shanghai Composite +0.5%; ASX200 +0.1%, Kospi +0.3%
Equity Futures: S&P500 +0.1%; Nasdaq100 +0.2%, Dax +0.2%; FTSE100 +0.4%
EUR 1.1784-1.1764; JPY 113.69-113.45; AUD 0.7529-0.7504;NZD 0.6911-0.6834
Feb Gold +0.2% at $1,251/oz; Jan Crude Oil -0.4% at $57.13/brl; Mar Copper +0.0% at $2.98/lb
