Notes/Observations
- Euro Zone inflation registered its 4th straight month below the ECB target of ‘around 2.0%
- Major European PMI Manufacturing data (France, Germany and Euro Zone) revised lowers to remain in contraction territory
- UK Parliament due to hold a second round of indicative votes on alternative Brexit options; talk of a holding a snap general election has circulated as her Cabinet said to be tense over whether to accept a soft Brexit or call a general election
Asia:
- China Mar Manufacturing PMI saw its 1st expansion since Oct (50.8 v 50.0e)
- China Mar Caixin Manufacturing PMI registered its 1st expansion in 4 months and highest level since July (50.8 v 50.0e
- Japan Q1 Tankan Large Manufacturers Index hit its lowest level since Mar 2017 (12 v 13e; Outlook Survey: 8 v 12e
Europe:
- EU Juncker stated that EU has had a lot of patience with our British friends over Brexit, but patience does runs out; Would like UK to reach an accord over Brexit in the coming days
- Reports circulated that PM May reportedly planned to bring Withdrawal Agreement deal back for a fourth time next week and would threaten election if she could not secure a majority
- UK Official stated that it could ask for another short Brexit extension, talks were ongoing with Northern Irish DUP party over Brexit deal. PM May was open to changing Brexit political declaration (Comments after UK Parliament rejected the Withdrawal Agreement last Friday)
- At least 6 ministers said to be planning to resign if PM May backed a no deal Brexit Other reports note that Brexiteers ministers would resign if PM May supported a customs union or called for another support of UK participation in EU elections
SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM
Equities
- Indices [Stoxx600 +1.07% at 383.12, FTSE +0.89% at 7,343.76, DAX +1.39% at 11,686.44, CAC-40 +1.10% at 5,409.54, IBEX-35 +0.79% at 9,317.00, FTSE MIB +0.86% at 21,469.50, SMI +0.37% at 9,512.50, S&P 500 Futures +0.75%]
- Market Focal Points/Key Themes: European Indices trade higher across the board with positive PMI data out of China putting a bid into Global markets. The Shanghai composite rose over 2.5% while US index futures point to a strong open. On the corporate front shares of Easyjet fall sharply in the UK after a cautious outlook citing Brexit uncertainty, with Low & Bonar also declining sharply as Revenue came in below expectations. Seabird Exploration, Voltabox, Paragon and Sanofi trade higher on earnings and trading updates. In other news Panalpina rises after agreeing to be acquired bu DSV in a CHF4.6B deal; Osram Licht rises on deal talk with Bain Capital while Poxel and Circassia Pharma trade higher following respective study updates. Looking ahead notable earners include Cal-Maine Foods, and Sorl Auto parts.
Equities
- Consumer discretionary: EasyJet [EZJ.UK] -7%, Ryanair [RYA.UK] -5% (EasyJet’s trading update), Low & Bonar [LWB.UK] -21% (trading update)
- Energy: Seabird Exploration [SBX.NO] +7% (new contracts)
- Healthcare: Novartis [NOVN.CH] +0.5% (acquisition), ImmuPharma [IMM.UK] -8% (update on license), AstraZeneca [AZN.UK] +1.5% (FDA approval)
- Industrials: Fiat [FCA.IT] +2.5%, PSA [UG.FR] +3.5% (Fiat JV with PSA), Panalpina [PWTN.CH] +16%, DSV [DSV.DK] -1% (to be acquired by DSV)
- Technology: Dialog Semiconductor [DLG.DE] +3.5%, Infineon [IFX.DE] +5%, STMicroelectronics [STM.FR] +3.5% (Hon Hai Precision Industries’ earnings), Voltabox [VBX.DE] +5.5% (earnings), Osram Licht [OSR.DE] +3% (CEO interview)
- Materials: Ferrexpo [FXPO.UK] +4% (Independent review update), Iofina [IOF.UK] +10% (debt restructuring)
Speakers
- UK Chief Treasury Secretary Truss: Not clear there was parliamentary majority for softer Brexit
- Greece Central Bank forecasted 2019 GDP growth at 1.9%
- Sweden Govt updated its economic forecasts which cut 2019 GDP growth from 2.1% to 1.6% while maintaining 2020 GDP growth at 1.6%
Currencies/Fixed Income
- EUR/USD was steady despite Euro Zone inflation missing expectations and remaining below ECB target for the 4th straight month. Pair hovering around 1.12 45 area just ahead of the NY morning.
- GBP/USD was higher by 0.3% in the session. Better UK PMI Manufacturing data helped to cement some positive sentiment for the Pound Sterling in the session. UK Parliament due to hold a second round of indicative votes on alternative Brexit options today. PM May continued to face opposition from the DUP party and a faction of pro-Brexit Conservatives. Despite her loss on Friday’s Withdrawal Agreement vote the outcome was nonetheless the best showing of PM May’s Brexit plan with margin of defeat down to 58 votes
Economic Data
- (RU) Russia Mar Manufacturing PMI: 52.8 v 50.1 prior (6th month of expansion and highest since Jan 2017)
- (SE) Sweden Mar PMI Manufacturing: 52.8 v 51.3e
- (CH) Swiss Feb Real Retail Sales Y/Y: -0.2% v -0.4%e
- (NL) Netherlands Mar Manufacturing PMI: 52.5 v 52.7 prior
- (NO) Norway Mar PMI Manufacturing: 56.8 v 55.3e
- (HU) Hungary Mar Manufacturing PMI: 52.4 v 54.3e (40th month of expansion)
- (PL) Poland Mar Manufacturing PMI: 48.7 v 47.4e (5th straight contraction)
- (TR) Turkey Mar Manufacturing PMI: 47.2 v 46.4 prior (12th straight contraction)
- (HU) Hungary Jan Final Trade Balance: €0.4B v €0.4B prelim
- (ES) Spain Mar Manufacturing PMI: 50.9 v 49.7e (returns back to growth)
- (CH) Swiss Mar PMI Manufacturing: 50.3 v 53.6e (lowest since Dec 2015)
- (CZ) Czech Republic Mar PMI Manufacturing: 47.3 v 47.3e (4th straight contraction and lowest since Dec 2012)
- (TH) Thailand Mar Business Sentiment Index: 51.4 v 49.9 prior
- (IT) Italy Mar Manufacturing PMI: 47.4 v 47.5e (6th straight contraction and lowest since May 2013)
- (FR) France Mar Final Manufacturing PMI: 49.7 v 49.8e (confirmed move back into contraction for 1st time in 3 months)
- (DE) Germany Mar Final Manufacturing PMI: 44.1 v 44.7e (confirmed 3rd straight contraction and lowest since Dec 2012)
- (EU) Euro Zone Mar Final Manufacturing PMI: 47.5 v 47.6e (confirmed 3rd straight contraction)
- (GR) Greece Mar Manufacturing PMI: 54.7 v 54.2 prior (22nd month of expansion)
- (IT) Italy Feb Preliminary Unemployment Rate: 10.7% v 10.5%e
- (CH) Swiss Weekly Total Sight Deposits (CHF) 576.1B v 575.9B prior; Domestic Sight Deposits: 488.5B v 489.3B prior
- (UK) Mar PMI Manufacturing: 55.1 v 51.2e (32nd month of expansion and highest reading since Feb 2018)
- (HK) Hong Kong Feb Retail Sales Value Y/Y: -10.1% v +3.6%e; Retail Sales Volume Y/Y: -10.4% v 3.1%e
- (EU) Euro Zone Mar Advance CPI Y/Y: 1.4% v 1.5%e (4th straight month below ECB target); Core CPI Y/Y: 0.8% v 0.9%e
- (EU) Euro Zone Feb Unemployment Rate: 7.8% v 7.8%e (matches lowest reading since Dec 2008)
- (ZA) South Africa Mar Manufacturing PMI: 45.0 v 46.5e
- (DK) Denmark Mar PMI Survey: 56.1 v 61.9 prior
- (BE) Belgium Feb Unemployment Rate: 5.7% v 5.8% prior
Fixed Income Issuance
- (MX) Mexico opened its book to sell EUR-denominated 7-year and 20-year bonds via syndicated
Looking Ahead
- (ZA) South Africa Mar Naamsa Vehicle Sales Y/Y: -5.0%e v -6.7% prior (revised from -6.5%)
- (IT) Italy Mar Budget Balance: No est v -€9.7B prior
- (RO) Romania Mar International Reserves: No est v $36.4B prior
- 05:30 (ZA) South Africa announces details of upcoming I/L bond sale (held on Fridays)
- 06:00 (IL) Israel to sell bonds
- 06:45 (US) Daily Libor Fixing
- 07:00 (IN) India announces details of upcoming bond sale (held on Fridays)
- 07:25 (BR) Brazil Central Bank Weekly Economists Survey
- 08:00 (CZ) Czech Mar Budget Balance (CZK): No est v -19.9B prior
- 08:00 (UK) Baltic Bulk Index
- 08:00 (ES) Spain Debt Agency (Tesoro) announces size of upcoming issuance
- 08:30 (US) Feb Advance Retail Sales M/M: 0.3%e v 0.2% prior; Retail Sales (Ex-auto) M/M: 0.3%e v 0.9% prior; Retail Sales (Ex-auto/gas): 0.3%e v 1.2% prior; Retail Sales (Control Group): 0.3%e v 1.1% prior
- 08:30 (CA) Canada Feb MLI Leading Indicator M/M: No est v 0.0% prior
- 09:00 (BR) Brazil Mar PMI Manufacturing: No est v 53.4 prior
- 09:00 (FR) France Debt Agency (AFT) to sell combined €3.6-4.8B in 3-month. 6-month and 12-month Bills
- 09:30 (CA) Canada Mar Manufacturing PMI: No est v 52.6 prior
- 09:45 (US) Mar Final Markit Manufacturing PMI: 52.5e v 52.5 prelim
- 10:00 (US) Mar ISM Manufacturing: 54.3e v 54.2 prior; Prices Paid: No est v 49.4 prior
- 10:00 (US) Feb Construction Spending M/M: -0.2%e v +1.3% prior
- 10:00 (US) Jan Business Inventories: 0.45e v 0.6% prior
- 11:00 (MX) Mexico Feb Total Remittances: $2.5Be v $2.4B prior
- 11:00 (MX) Mexico Central Bank Economist Survey
- 11:30 (MX) Mexico Mar PMI Manufacturing: No est v 52.6 prior
- 11:30 (US) Treasury to sell 3-Month and 6-Month Bills
- 12:00 (IT) Italy Mar New Car Registrations Y/Y: No est v -2.4% prior
- 14:00 (MX) Mexico Mar IMEF Manufacturing Index: 52.0e v 54.3 prior; Non-Manufacturing Index: 51.7e v 50.7 prior
- 15:10 (CA) Bank of Canada’s Poloz
- (BR) Brazil Jan CNI Consumer Confidence: No est v 114.3 prior
- (AR) Argentina Mar Government Tax Revenue (ARS): No est v 330.9B prior
- (BR) Brazil Mar Trade Balance: $5.4Be v $3.7B prior; Total Exports: $19.1Be v $16.3B prior; Total Imports: $13.6Be v $12.6B prior
