China Continues To Build Foreign Reserves

Apr 08 19, 06:51 GMT

General Trend:

With little catalyst to keep momentum going markets faltered after higher openings
USD is mixed against the majors, with little prevailing trend
Nissan shareholders vote to remove Ghosn as a director, severing his last ties with the company. CEO has indicated they may go after him for damages.
G7 agreed on all major points with the exception of Israel/Palestine and Iran
China’s top banks are putting more loan resources into property loans despite the govt calling on them to fund small businesses.
US, China trade talks continue, with no specific end date in sight, sticking points remain the same
China March foreign reserves came in at a 7-month high and had their 5th consecutive increase
Oil gained as fighting increases around Tripoli
Big week ahead for Brexit, with PM May heading to Brussels mid-week; shes indicated they need a deal or to remain, legislation said to be going into place that would put Parliament in control of the process

Headlines/Economic Data

Australia/New Zealand

ASX 200 opened +0.1%
BHP.AU Plans to cut over 700 finance and IT jobs – The Australian
RSG.AU Reports Q3 gold production 98.1K oz v 74.0K q/q
PPS.AU Notified by a key Australian institutional client of the investment platform that it has selected an alternative supplier; Expands services with Shaw and Partners
NAB.AU In talks to sell New Zealand life insurance unit to Partners Life – Aussie press
(AU) Australia buyback A$900M in 4.50% April 2020 and 5.75% May 2021 bonds
(AU) Australia sells A$400M v A$400M indicated in 2.75% June 2035 bonds, avg yield 2.1445%; bid to cover 3.22x
(AU) Australia Mar ANZ Job Advertisements m/m: -1.7% v -0.8 prior

Japan

Nikkei 225 opened +0.4%
(JP) Japan Econ Min Seko: Dissatisfaction among franchisees is growing, need to find remedies for these long hours – speaking to leaders of 24 hour convenience store operators
(JP) JAPAN FEB PRELIMINARY ADJUSTED CURRENT ACCOUNT: ¥1.96T V ¥1.9TE; CURRENT ACCOUNT BALANCE: ¥2.68T V ¥2.63BE
(JP) Bank of Japan (BOJ) Gov Kuroda: Reiterates BOJ to keep rates very low for extended period – speaking at Branch Managers meeting; expect CPI to pick up to 2% target
7201.JP CEO Saikawa: Want to consult with shareholders on next move and get approval for total removal of former chairman Ghosn – speaking at extraordinary shareholder meeting
(JP) Japan PM Abe: Will do all possible to manage economy amid global uncertainty; to visit France, Italy and US from Apr 22-29
(JP) Japan Mar Bankruptcies Y/Y: -16.1% v -4.5% prior

Korea

Kospi opened +0.4%
003490.KR Chairman Cho Yang Ho has died from illness
(KR) Bank of Korea (BOK) sells KRW1.3T in 1-yr bonds, avg yield 1.78%
(KR) South Korea President Moon approval rating falls to 47.3% last week after a failed nomination of a new minister he had to withdraw – Yonhap

China/Hong Kong

Hang Seng opened +0.6%; Shanghai Composite opened +0.8%
(CN) CHINA MAR FOREIGN RESERVES: $3.099T V $3.1TE (7-month high, 5th consecutive increase)
(CN) Chinese state media: China and US made progress in the latest round of trade talks (Saturday)
(CN) White House indicates there is no time table for trade talks with China, making the likelihood of a summit between Trump and President Xi unlikely before the end of April – Nikkei
(CN) China regulators may ask brokers to subscribe 2-5% of tech IPOs – China press
(CN) China “government guidance funds” to direct capital to chosen sectors currently targeting investments over $1.48T – SCMP
(CN) China PBoC Open Market Operation (OMO): Skips for 13th consecutive session: Net: CNY0 v CNY0 prior
(CN) China PBoC sets yuan reference rate: 6.7201 v 6.7055 prior
(CN) According to SCMP, despite China govt’s push for state owned banks to lend more to private companies, half of new loans issued by China’s big six banks in 2018 went to individual property buyers and only 29% went to private companies v 57.5% y/y
(CN) China pressured by US to give up ‘developing country’ status believe it is important to global trade to keep this status – SCMP

North America

PINS Expected to set IPO price range below last valuation – US financial press
(US) Analysts speculate that it is increasingly unlikely the Congress will pass the revised NAFTA agreement before 2020 election due to opposition from Democrats and unions to labor provisions – financial press

Europe

(UK) PM May: we now have a stark choice — leave the EU with a deal or do not leave at all
FCA.IT Reached agreement with Tesla, where it will pay Tesla “hundreds of millions of euros” to have Tesla’s electric cars counted in its fleet which will allow it to avoid large fines for breaking new EU emissions rules – FT
(G7) France Foreign Min Le Drain: G7 nations are broadly in agreement on a range of issues, except for differences over approach to Iran and Israeli-Palestinian conflict
(UK) Govt is drawing up legal language that would guarantee that Parliament would have the final say on Brexit deal with Brussels – Sunday Times

Levels as of 01:20ET

Hang Seng +0.2%; Shanghai Composite -0.5%; Kospi -0.1%; Nikkei225 -0.2%; ASX 200 +0.6%
Equity Futures: S&P500 -0.2%; Nasdaq100 -0.2%, Dax -0.4%; FTSE100 -0.4%
EUR 1.1214-1.1233; JPY 111.35-111.78; AUD 0.7088-0.7109; NZD 0.6722-0.6738
Commodity Futures: Gold +0.4% at $1,300/oz; Crude Oil +0.4% at $63.35/brl; Copper +0.7% at $2.91/lb