Asian Equity Indices Track Gains Seen On Friday’s US Session

Jan 07 19, 07:51 GMT

General Trend:

Shanghai Composite supported by the IT and Telecom sectors
China’s banking index declines after gaining ahead of RRR cut announcement
US equity futures pare gains
Tech, Iron/Steel and Marine Transportation companies rise in Japan
Resources sector outperforms in Australia
US Dollar trades generally weaker, recent comments from Fed Chair Powell eyed
Oil Futures track gains in the equity markets
Australia Manufacturing PMI contracts for the first time in 26 months
China and US to hold vice-ministerial level trade talks on Jan 7-8th (Mon-Tues)
Corporate earnings in focus this week: Samsung expected to report prelim Q4 results on Tuesday (Jan 8th)
Partial US government shutdown entered 16th day as of Sunday

Headlines/Economic Data

Japan

Nikkei 225 opened +2.0%
(JP) Japan PM Abe: Govt to keep a close eye on increasing risks to global economic recovery as it guides policy – Japan press
(JP) Japan Dec PMI Services: 51.0 v 52.3 prior; PMI Composite: 52.0 v 52.4 prior
(JP) Japan Nov Loans & Discounts Corp y/y: 3.7% v 3.3% prior
(JP) Japan Dec Monetary Base y/y: 4.8% v 5.8%e; Monetary Base end of Period: ¥504.2T v ¥505.8Te
4502.JP To issue 770M shares at ¥7,601/share, relates to acquisition of Shire
6758.JP President said to be planning to make entertainment assets a priority – press
4502.JP CEO: Will give combined company (Shire) guidance in May; Takeda will have divestments in 2019 for sure, it is a way to deleverage quickly

Korea

Kospi opened +1.2%
005930.KR Speculated to target 2019 smartphone production below 300M units – US financial press
(KR) South Korea Dec Foreign Exchange Reserves: $403.7B v $402.9B prior
(KR) South Korea President Moon to hold new years press conference this week to address his administration’s policy objectives for 2019
(KR) North Korea calls on the United States on to take “corresponding” steps for the “sincere measures” the North has taken toward denuclearization since their summit in June – Yonhap

China/Hong Kong

Hang Seng opened %, Shanghai Composite %
(CN) China and US to have sit down talks on trade Monday, first time since the start of the 90-day extension to tariff implementation – SCMP
(US) President Trump expected to hold talks with China VP Wang Qishan in Davos – SCMP
(CN) China PBoC Open Market Operation (OMO): Skips v CNY10B injected in 7-day reverse repos prior; Net: CNY170B drain v CNY160B drain prior
(CN) China PBoC sets yuan reference rate: 6.8517 v 6.8586 prior
(CN) China has room for additional cut to RRR – China Daily
(CN) China Ministry of Industry and Information Technology and 11 agencies issues new guidelines on rare earth: to impose severe penalties on those illegally mine, produce or export rare-earth materials; China is currently not putting a cap on rare-earth exports
(CN) China PBoC adviser Sheng Songcheng said rising trend for domestic property prices is no longer a certainty, notes ‘unprecedented state housing price controls have come into effect – financial press
1530.HK Unit received exclusive licenses for SB8 in mainland China; Announces collaboration agreement with Samsung Bioepis [+8.8%]

Australia/New Zealand

Other Asia

North America

(US) TSA issued statement about security workers calling in sick amid govt shutdown; says the ‘call outs’ are causing “minimal impact”
(US) Pres Trump tweets that he never committed any campaign violations; other politicians who have had campaign finance violations paid fines to settle these civil cases
(US) President Trump: Affirms demand for border wall, but says the barrier could be made of steel instead of concrete
(US) Pres Trump says drug makers are not living up to their commitments on pricing – tweet
Dollar Tree [DLTR]: Activist investor Starboard said to take 1.7% stake, the shareholder favors a sale of Family Dollar and pricing model changes – US financial press
AAPL Production of iPhone XR for first 6-months thought to be cut by 50% to 30-40M – US financial press

Europe

(UK) British Dec high street sales -1.9% y/y (6th consecutive year of declines) according to BDO data – press
(UK) UK PM May said Britain would be in ‘uncharted territory’ if her Brexit deal is rejected by parliament – financial press
(UK) According to YouGov poll, 46% of those polled would vote to remain in the EU vs 39% who would vote to leave – financial press

Levels as of 12:50ET

Hang Seng +0.9%; Shanghai Composite +0.5%; Kospi +1.4%; Nikkei225 +2.7%; ASX 200 +1.1%
Equity Futures: S&P500 +0.3%; Nasdaq100 +0.4%, Dax +0.2%; FTSE100 +0.2%
EUR 1.1397-1.1431; JPY 108.03-108.62; AUD 0.7109-0.7138; NZD 0.6729-0.6756
Feb Gold +0.5% at $1,292/oz; Feb Crude Oil +1.6% at $48.73/brl; Mar Copper -0.3% at $2.64/lb