General Trend:
- Asian equity markets trade mixed
- Financials and tech firms decline in Japan, similar to Wednesday’s US trading session
- Softbank declines over 3%, tracks weakness in US tech sector
- Equity markets in China outperform amid renewed speculation of H2 RRR cut
- Shanghai Property index rises after Oct home price data
- Chinese automakers trade mixed, official plays down tax cut for auto purchases
- Tencent gains over 3% post earnings
- Toshiba’s shares supported by stock buyback
- Asian corporate earnings slowdown on today’s session
- Fed’s Powell comments on housing market, Treasury Futures gain
- Aussie gains on better than expected labor market data, 3-year yields rise
- NZ PM Ardern: US/China trade war may be hurting business confidence in New Zealand
- China’s largest bank ICBC said to cancel USD bond sale
Headlines/Economic Data
Japan
- Nikkei 225 opened -0.8%
- (JP) Japan Investors Weekly Net Buying of Foreign Bonds: +¥1.62T v -¥167.3B prior; Foreign Buying of Japan Stocks: +¥360.9B v +¥107.6B prior
- (JP) JAPAN Q3 HOUSING LOANS Y/Y: 2.4% V 2.7% PRIOR
- (JP) Nikkei survey finds that Q4 GDP seen at 2.1% q/q v 1.2% prior
- (JP) Leaders of 16 countries reaffirmed their commitment to the Regional Comprehensive Economic Partnership (RCEP) after they failed to conclude the deal earlier this week – Nikkei
- (JP) Japan MOF sells ¥2.0T v ¥2.0T indicated in 0.10% 5-yr JGB: avg yield: -0.0870% v -0.055% prior, bid to cover: 3.89x v 4.88x prior
Korea
- Kospi opened flat
- (KR) SK Energy Co. Ltd., GS Caltex Corporation and Hanjin Transportation agree to pay $236M fine for their involvement in a bid-rigging scheme in supplying fuel to US military bases in the country
- 207940.KR Trading halted over accounting fraud
- (US) Vice President Pence: Much work remains to denuclearize North Korea, but meaningful progress has been made
China/Hong Kong
- Hang Seng opened +0.8%, Shanghai Composite flat
- (CN) China govt reportedly has sent written response to US regarding trade reforms – press
- (CN) China’s PBOC expected to cut RRR by over 0.5 ppts in Q4 – China press
- (CN) China PBoC Open Market Operation (OMO):Skips OMO v skipped prior (15th straight skip)
- (CN) CHINA PBOC SETS YUAN REFERENCE RATE: 6.9392 V 6.9402 PRIOR
- (CN) US Congress report compiled by the US/China Economic and Security Review Commission notes China’s hegemonic ambitions pose certain risk to US security and economic interests – Japan press
- (CN) China Oct New Home Prices m/m: 1.0% v 1.0% prior; y/y: 8.6% v 7.9% prior
- (CN) China NDRC: Have not looked into auto purchase tax reduction
- (CN) China said to halt customs clearance of coal imports in 2018 – US financial press
Australia/New Zealand
- ASX 200 opened flat
- (AU) AUSTRALIA OCT EMPLOYMENT CHANGE: +32.8K V +20.0KE (3RD MONTH OF GROWTH); UNEMPLOYMENT RATE: 5.0% V 5.1%E
- GNC.AU Reports FY18 (A$) Net 70.5M v 68Me; Underlying EBITA 269M v 260Me, Rev 4.25B v 4.58B y/y
- (AU) Australia Nov Consumer Inflation Expectation: 3.6% v 4.0% prior
- (NZ) New Zealand PM Ardern: Discussed benefits of free trade with US VP Pence; discussed steel and aluminum tariffs
- (NZ) New Zealand sells NZ$150M v NZ$150M indicated in 2.75% 2037 bonds; avg yield 3.0687%; bid to cover 2.85x
- (AU) Australia Oct RBA Govt FX Transactions (A$): -542M v -801M prior
- (AU) RBA Deputy Gov DeBelle: Major banks’ share of new home lending is at the lowest in 10-yrs; tighter mortgage lending standards have sharply lowered housing risks
North America
- (US) Weekly API Oil Inventories: Crude: +8.8M v +7.8M prior
- NTES Reports Q3 $2.55 v $3.04 y/y, Rev $2.45B v $2.0B y/y; Approves up to $1.0B buy back
- (US) Fed Chair Powell: challenges include how much further to hike and at what pace; pretty good reason economy stays on healthy track; reiterates all meetings are live
Europe
- (UK) PM May: collective decision of the cabinet is to support the Brexit deal; I believe this is the best deal that could be negotiated (during US session)
- (UK) Brexiteers say there will be enough letters by ‘lunch tomorrow’ to force confidence vote against PM May – ITV’s Peston
- (UK) Brexiteer MP Rees-Mogg (Conservative Party) says has not called for confidence vote related to PM May – US financial press
- (IE) Ireland PM Varadkar: pleased that the EU and UK have reached an agreement; have reached a satisfactory outcome on Ireland priority’s
- (RU) Russia Central Bank Gov Nabiullina: Market volatility could be boosted by swings in oil prices and capital flows
Levels as of 12:50ET
- Hang Seng +0.8%; Shanghai Composite +1.0%; Kospi +0.1%; Nikkei225 -0.3%; ASX 200 +0.1%
- Equity Futures: S&P500 +0.0%; Nasdaq100 +0.2%, Dax +0.0%; FTSE100 +0.2%
- EUR 1.1307-1.1342; JPY 113.43-113.67 ; AUD 0.7188-0.7282;NZD 0.6756-0.6809
- Dec Gold +0.1% at $1,211/oz; Dec Crude Oil -0.2% at $56.12/brl; Dec Copper +0.4% at $2.72/lb
