General Trend:
- Consumer Discretionary index outperforms in Shanghai, China Dec retail sales beat ests
- Shanghai Property index underperforms, China Dec property investment slowed
- Trade-sensitive Marine/Transportation index continues to outperform in Japan
- Energy, financial and resources companies rise in Australia
- China 2018 GDP growth was the slowest since 1990, exceeded annual target of ~6.5%
- There is renewed speculation of little progress regarding US/China talks on intellectual property issues (US financial press)
- China dismisses deflation concerns
- South Korea Jan prelim semiconductor exports decline ~29%
- US markets closed for holiday on Monday
- BoJ due to meet Jan 22-23rd
Headlines/Economic Data
Japan
- Nikkei 225 opened +0.9%
- 5938.JP Says not considering management-led buyout (responds to press report) [+~10%]
- 7201.JP CEO Saikawa: Not at the stage to talk about capital tie ups with Renault, have not heard anything about an integration
- (JP) Nomura Securities revision index for non-financial companies’ FY19 earnings was -30.2 as of late last week, suggests earnings downgrades are forecast to exceed upgrades – Nikkei
Korea
- Kospi opened +0.5%
- (KR) White House spokesperson: Pres Trump and North Korea Leader Kim summit scheduled for end of Feb; location to be announced later
- (KR) South Korea Jan 1-20th Trade Balance: -$1.6B; Imports y/y: -9.5% v +2.2% prior; Exports y/y: -14.6% v +1.0% prior; Semiconductor exports y/y: -28.8%
- (KR) North Korea propaganda suggests South Korea should help to restart cross border economic projects – Yonhap
- (KR) South Korea sells KRW700B v KRW700B indicated in 20-year bonds: avg yield 2.035% v 2.170% prior
China/Hong Kong
- Hang Seng opened +0.2%, Shanghai Composite +0.1%
- (CN) CHINA Q4 GDP Q/Q: 1.5% V 1.5%E; Y/Y: 6.4% V 6.4%E; 2018 Y/Y: 6.6% (slowest full year growth since Q1 2009) V 6.6%E
- (CN) China National Bureau of Stats (NBS) Chief Ning: US-China trade war impacted economy but manageable; reiterates has plenty of tools and measures to adjust policy
- (CN) China reportedly offered a 6-year $1T import boost at Jan talks in order to eliminate US trade imbalances by 2024; US trade officials said to be skeptical (press report from Jan 18th)
- (CN) USTR Lighthizer said to have told US lawmakers China and US are making little progress on intellectual property (IP) issues (in line with report from Jan 15th)
- (CN) CHINA DEC RETAIL SALES Y/Y: 8.2% V 8.1%E; 2018 Y/Y: 9.0% V 9.0%E
- (CN) CHINA DEC INDUSTRIAL PRODUCTION Y/Y: 5.7% V 5.3%E; 2018 Y/Y: 6.2% V 6.2%E; Capacity Utilization: 76.0% v 76.5% prior
- (HK) Hong Kong Monetary Authority (HKMA) said to conduct checks of bank rate on monthly basis in order to avoid surprises – Local Press
- 763.HK (US) Reportedly Trump Administration is preparing an executive order that would restrict Chinese telecoms from operating in the US – press
- (US) Pres Trump: there was a false report about lifting China tariffs; trade talks are going well and a trade deal with China “could very well happen”
- (CN) China PBoC Open Market Operation (OMO): Skips v CNY20B injected in 7-day and 28-day reverse repos prior; Net: CNY80B drain v CNY20B injection prior
- (CN) China PBoC sets Yuan Reference Rate: 6.7774 v 6.7665 prior
- 700.HK Maoyan (backed by Tencent) to delay IPO to Feb 4th v Jan 31st prior, secures 3 additional cornerstone investors
- (CN) China Dec Property Investment y/y: 9.5% v 9.7% prior
- (CN) China Dec Surveyed Jobless Rate: 4.9% v 4.8% prior
- (CN) China Premier Li: Important to stimulate market vitality to withstand downward pressure and relying on the strength of the people to promote coordinated economic and social development – presided over a symposium on Friday to solicit opinions from professionals in higher education, science and technology, healthcare and sports on the draft of the Government Work Report
- (CN) China earlier and quicker issuance of 2019 new local government bonds is expected to play a major role in narrowing infrastructure funding gaps and bolstering economic growth – China press
Australia/New Zealand
- ASX 200 opened +0.2%
- HSO.AU Updates on Brookfield proposal: Brookfield is currently finalizing due diligence and will seek needed approvals before making binding offer, expected to make fully financed binding offer by Jan 31st
- (AU) Moody’s: Australia states are feeling pressure from correction in housing
- (AU) Australia sells A$700M v A$700M indicated in 2.75% April 2024 bonds, avg yield 1.9831%, bid to cover 3.8x
- (AU) Australia Dec HIA New Home Sales m/m: -6.7% v +3.6% prior
- (NZ) New Zealand Trade Min: There are a number of nations keen to join CPTPP; including US
Other Asia
- 2354.TW Said to have cut 50,000 seasonal jobs 1-month earlier than usual due to weaker iPhone demand – Nikkei
North America
- (US) Pres Trump offers 3 year extension of DACA protections in exchange for $5.7B for border wall funding; Sen majority leader McConnell has agreed to hold a vote on this proposal in the Senate
Europe
- (DE) Germany Foreign Min Maas: Unclear how any UK /Ireland talks could work, UK needs a Brexit deal with the whole EU; will be very difficult to re-negotiate UK’s withdrawal agreement with EU – German TV
- (UK) PM May said to be considering amending the Good Friday agreement, after another failed attempt at negotiating a cross party Brexit deal – Telegraph
- TKA.DE Planning to invest £10B over the next 30-yrs to exit coking coal – German press
- (UK) Jan Rightmove House Prices m/m: +0.4% v -1.5% prior; y/y: 0.4% v +0.7% prior
Levels as of 12:50ET
- Hang Seng +0.3%; Shanghai Composite +0.4%; Kospi -0.1%; Nikkei225 +0.3%; ASX 200 +0.2%
- Equity Futures: S&P500 -0.3%; Nasdaq100 -0.4%, Dax -0.3%; FTSE100 -0.3%
- EUR 1.1361-1.1381; JPY 109.47-109.78 ; AUD 0.7151-0.7175;NZD 0.6715-0.6759
- Feb Gold -0.1% at $1,280/oz; Mar Crude Oil +0.2% at $54.16/brl; Mar Copper -0.5% at $2.69/lb
