HomeContributorsFundamental AnalysisChina Banks Start To Cut Mortgage Rates

China Banks Start To Cut Mortgage Rates

General Trend:

  • Equities markets plunge lower tracking volatile New York session
  • Asian chipmakers generally track declines in the US
  • South Korean chipmaker Hynix declines over 4%, sees slowing DRAM price growth
  • Panasonic rises over 1%, Tesla gained following its earnings report
  • Australia’s AMP Ltd declines over 17%, issued quarterly update on wealth management unit
  • Qantas declines over 3% after quarterly sales report
  • Iron Ore miner Fortescue drops over 5%, Q1 shipments declined
  • Data breach weighs on shares of Cathay Pacific
  • South Korea Q3 GDP misses ests with Nov rate decision in focus
  • China said to have made its first coordinated move since 2017 to lower mortgage rates in some Tier 1 cities, sparking talk that rates have peaked
  • Canon Inc is expected to report earnings after the Tokyo close
  • US companies expected to report earnings on Thursday (including afterhours) include Alphabet, Altria, Amazon, Bristol-Myers, CME Group, Celgene, Chipotle, Comcast, ConocoPhillips, First Solar, Intel, International Paper, KKR, Mattel, Merck, Sherwin-Williams, Snap and Western Digital
  • ECB is due to hold its policy meeting later today

Headlines/Economic Data

Japan

  • Nikkei 225 opened -1.9%
  • (JP) Japan FSA considering capping crypo leverage trading – Nikkei
  • (JP) Bank of Japan (BOJ) Deputy Gov Wakatabe: Taking strong steps to burst bubble could push economy into serious recession; still talks on feasibility of tightening monetary policy as a preemptive step against rise in asset prices
  • (JP) Japan Investors Weekly Net Buying of Foreign Bonds: ¥8.1B v +¥1.02T prior; Foreign Buying of Japan Stocks: +¥76.5T v +¥52.4B prior
  • (JP) JAPAN SEPT SERVICES PPI Y/Y: 1.2% V 1.2%E
  • Sharp, 6753.JP Reports prelim H1 Net ¥40B v ¥36B guidance, Op ¥46.5B v ¥46.0B guidance; Cuts Rev forecast to ¥1.13T v ¥1.30T prior [-9% in early trade]
  • (JP) Japan MoF sells ¥2.1T v ¥2.1T indicated in 0.10% 2-yr JGBs, avg yield -0.117% v -0.1120% prior, bid to cover 5.31x v 4.37x prior

Korea

  • Kospi opened -2.4%
  • (KR) SOUTH KOREA Q3 PRELIM GDP Q/Q: 0.6% V 0.8%E; Y/Y: 2.0% V 2.3%E
  • Hynix, 000660.KR Reports Q3 (KRW) Net 4.7T v 4.6Te; Op 6.47T v 6.3Te; Rev 11.4T v 11.8Te
  • (KR) South Korea Finance Minister comments after weaker than expected Q3 GDP data: Achieving 2.9% GDP growth may not be easy
  • (KR) Bank of Korea (BoK): Held meeting today to discuss US stock market decline, domestic economic fundamentals are stable
  • Hyundai Motor, 005380.KR Reports Q3 (KRW) Net 306B v 939B y/y; Op 289B v 1.2T y/y; Rev 24.4T v 2.2T y/y [ -10%]

China/Hong Kong

  • Hang Seng opened -1.9%, Shanghai Composite -2.4%
  • (CN) Bank in multiple China cities including Beijing, Guangzhou, Hangzhou, and Foshan have all cut mortgage lending rates, the first coordinated move since 2017 – Chinese press
  • (CN) China should cut stamp duty for loss making stock investors – Chinese Press
  • (CN) China has been quietly reducing production of rare earth in H2, seen as a move to drive up prices
  • 1810.HK Guides shipments of smartphones to exceed 100M units by the end of Oct
  • (CN) China Guangzhou said to seek investments in 20 state-backed companies – Chinese Press
  • 293.HK Cathay Pacific discovered unauthorized access to some passenger data that could affect ~9.4M passengers
  • (CN) Two China funds, CM Fengqing Flexible Allocation Fund and E Fund Ruihui Flexible Fund, both sold all holdings totaling $4.0B in bonds and stocks during Q3 without giving an explanation – US financial press
  • (CN) China PBOC sets Yuan Reference Rate: 6.9409 v 6.9357 prior
  • (CN) China PBoC Open Market Operation (OMO): To inject CNY100B in 7-day reverse repos v CNY150B prior: Net: CNY100B injection v CNY150B prior
  • (CN) China said to be tightening scrutiny of offshore investment using state assets – China Daily
  • (CN) China Banking and Insurance Regulator (CBIRC): Will support insurers’ investment in listed companies
  • (CN) China President Xi: Looking for ways to support small companies – Xinhua

Australia/New Zealand

  • ASX 200 opened -1.4%
  • QAN.AU Reports Q1 (A$) Rev 4.41B v 4.19B y/y
  • (NZ) New Zealand Sept Trade Balance (NZ$): -1.56B v -1.37Be; 12-mnth YTD: -5.19B v -5.02Be
  • AMP.AU Completes portfolio review: To spin off NZ wealth management unit via IPO next year; to sell ANZ wealth protection and mature businesses to Resolution Life for A$3.3B
  • FMG.AU Reports Q1 Iron Ore shipped 40.2Mt, -9% y/y; Production 51.9Mt, +14% y/y
  • (AU) Fitch affirms Australia sovereign rating at AAA; outlook Stable

Other Asia

  • (TW) Taiwan Cabinet Spokesperson: Major Taiwan Govt funds are ready to defend the stock market if needed

North America

  • US equity markets ended lower: Dow -2.4%, S&P500 -3.1%, Nasdaq -4.4%, Russell 2000 -3.8%
  • (US) Fed’s Brainard (voter, dove) no comments on monetary policy in speech

Europe

  • (UK) Certain technology companies said to have met with the UK government in London to seek assurances about the impact of a no-deal Brexit on jobs and investment – UK Press
  • (UK) PM May meeting to the 1922 committee of Conservative MPs (back benchers): PM gave several examples of what concessions EU had made to Britain

Levels as of 01:30ET

  • Hang Seng -2.1%; Shanghai Composite -1.7%; Kospi -2.2%; Nikkei225 -3.4%; ASX 200 -2.8%
  • Equity Futures: S&P500 +0.3%; Nasdaq100 +0.5%, Dax -0.7%; FTSE100 -0.8%
  • EUR 1.1380-1.1476; JPY 111.82-112.25 ; AUD 0.7056-0.7085;NZD 0.6502-0.6530
  • Dec Gold +0.7% at $1,239/oz; Dec Crude Oil -1.1%at $66.11/brl; Dec Copper -0.5% at $2.73/lb
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