Trump To Delay Higher Tariffs On China

Feb 25 19, 07:43 GMT

General Trend:

Shanghai Composite rises to highest level since Aug 1, 2018 on progress in US trade talks
US President Trump agrees to delay implementation of China trade tariffs, originally scheduled for March 1st
UK PM May reportedly considering plan that would delay Brexit by 2-months; rules out meaningful vote on EU withdrawal in commons this week
Shenzhen Telecom index up over 5.5%, supported by ZTE
Equity markets in Japan supported by Electric/Appliances, Financials, Iron/Steel and Machinery shares.
Financials in Australia lag amid speculated banking levy
Bluescope Steel rises over 5% post earnings, sees FY19 EBIT up approx. 10%
Lend Lease declines over 4% in Australia, H1 profits declined
Yuan (CNY) gains on tariff delay, Trump confirmed progress was made on issues including currency
Officials from China are scheduled to go back to Beijing on Monday.
US retailer earnings in focus this week
The second Trump/Kim summit is expected to be held in Vietnam from Feb 27-28th.

Headlines/Economic Data

Japan

Nikkei 225 opened +0.7%
(JP) Japan stock market is expected to host ~90 IPOs in 2019 v 90 in 2018 – Nikkei
(JP) Japan Jan PPI Services y/y: 1.1% v 1.1%e
8306.JP Labor union expected to request first base pay increase in 4 years – Japanese Press
(JP) Japan PM Abe Adviser Hamada: BoJ can abandon 2% inflation target as it is not absolutely crucial
(JP) Japan Dec Final Leading Economic Index: 97.5 v 97.9 prelim; Coincident Index: 101.8 v 102.3 prelim

Korea

Kospi opens +0.5%
(KR) South Korea to offer firms incentives such as tax cuts, discounts on rental fees in industrial parks for job creating investment – Yonhap
(KR) South Korea sells KRW598B in 20-yr Govt bonds; avg yield 2.065% v 2.17% prior

China/Hong Kong

Hang Seng opens +0.6%; Shanghai Composite opens +1.2%
(CN) President Trump: Made progress with China in the areas of intellectual property (IP), technology, currency and agriculture as well as many other areas; delay to March 1st implement tariff on China goods is due to productive talks
(CN) US and China said to remain apart on issues related to enforcement and some structural issues; US Trade Rep Lighthizer: progress has been made on structural issues, but major hurdles remain – US financial press
(CN) China Trade Delegation: Confirms substantial progress made on issues such as tech transfer, intellectual property rights, non-tariff barriers, service industry, agricultural and currency
(CN) China PBoC Open Market Operation (OMO): Injects CNY40B in 7-day reverse repos v CNY40B injected in 7-day reverse repos prior; Net: CNY40B injected v CNY40B injection prior
(CN) China PBoC sets Yuan Reference Rate: 6.7131 v 6.7151 prior
(CN) New third stock board in China said to see ‘strong’ financing growth in Jan – financial press
2318.HK Planning a $1.0B Hong Kong IPO for fintech unit, OneConnect, in H2 this year
HUAWEI.CN US President Trump said to be planning to hold talks on dropping criminal charges against Huawei – SCMP

Australia/New Zealand

ASX 200 opened +0.2%
(AU) Australia Labor leader Bill Shorten expected to announce a A$640M levy on banks and financial service companies to fund support for banking misconduct victims – Aussie press
(NZ) NEW ZEALAND Q4 RETAIL SALES (EX INFLATION) Q/Q: 1.7% V 0.5%E; Y/Y: 3.5% V 2.7% PRIOR
BSL.AU Reports H1 (A$) Net 624.3M v 441.2M y/y; EBITDA 1.06B v B y/y; Rev 6.40B v 5.48B y/y
(AU) Australia sells A$400M v A$400M indicated in 3.25% June 21 2039 bonds, avg yield 2.5125% , bid to cover 2.66x
LLC.AU Reports H1 (A$) Net 15.7M v 425.6M y/y; EBITDA 83.1M v 720.6M y/y; Rev 7.77B v 8.63B y/y
BXB.AU Enters agreement to sell IFCO to Triton and Luxinva for enterprise value of $2.51B; to return $1.95B to shareholders through special dividend and buyback

Other Asia

AAPL Suppliers in Taiwan for iPhone 6s said to receive rush orders due to strong sales in India -Taiwan Press
(SG) Singapore Jan CPI M/M: -0.3% v 0.1%e; Y/Y: 0.4% v 0.6%e; Core CPI Y/Y: 1.7% v 1.8%e; Singapore Govt cuts 2019 headline CPI forecast to 0.5-1.5% (prior 1-2%), keeps core CPI outlook

North America

BRK.A Reports Q4 Net earnings per A share -$15,467* v +$19,790 y/y, Rev $63.7B v $58.9B y/y

Europe

(UK) PM May considering plan that would delay Brexit by 2-months; rules out meaningful vote on EU withdrawal in commons this week – Telegraph

Levels as of 12:50ET

Hang Seng +0.2%; Shanghai Composite +3.9%; Kospi +0.0%; Nikkei225 +0.5%; ASX 200 +0.3%
Equity Futures: S&P500 +0.2%; Nasdaq100 +0.3%, Dax +0.3%; FTSE100 +0.1%
EUR 1.1325-1.1350; JPY 110.58-110.86; AUD 0.7134-0.7162; NZD 0.6853-0.6884
Commodity Futures: Gold -0.0% at $1,332/oz; Crude Oil -0.3% at $57.11/brl; Copper +0.0% at $2.95/lb