General Trend:
- China yet to announce specific trade countermeasures
- Trade-sensitive Chinese Telecom Services and IT sectors outperform; ZTE rises 3%
- Japanese wages extended declines in March
- RBA Quarterly Statement on Monetary Policy maintained Dec 2020 and June 2021 GDP forecasts, forecasts made on technical assumption that rates follow market pricing of two cuts to 1% (current cash rate is 1.50%)
- Aussie traders generally ignore RBA quarterly statement amid recent rate decision and focus on US/China trade
Headlines/Economic Data
Australia/New Zealand
- ASX 200 opened +0.2%
- (AU) RESERVE BANK OF AUSTRALIA (RBA) STATEMENT ON MONETARY POLICY (SOMP) : Forecasts made on technical assumption that rates follow market pricing of two cuts to 1% (current cash rate is 1.50%)
- (NZ) Reserve Bank of New Zealand (RBNZ) Dep Gov Bascand: Watching data and budget to asses if 2nd rate cut is needed; Needs 3% economic growth to meet inflation target
- (NZ) Outbreak of African swine fever in China could impact the dairy sector in New Zealand – NZ Press
China/Hong Kong
- Shanghai Composite opened +1%, Hang Seng +0.5%
- (CN) TRUMP IMPLEMENTATION OF TARIFFS ON $200B IN CHINA GOODS FROM 10% TO 25% TAKES EFFECT
- (CN) CHINA ANNOUNCES TO RETALIATE TO US TARIFF INCREASE (awaiting specifics)
- (US) White House Spokesman: US President Trump met with USTR Lighthizer and Treasury Sec Mnuchin to discuss the ongoing trade negotiations with China; Confirms Lighthizer and Mnuchin agreed with China Vice Premier Liu He to continue discussions on Friday morning (as expected)
- (CN) China Negotiator/Vice Premier Liu He: Additional Tariffs not a solution; comes to US with sincerity
- (CN) Pres Trump: Have just received a letter from China Pres Xi; plans to speak with Pres Xi by phone as trade talks continue
- (US) Customs & Border Protection: affected US-bound cargoes leaving China before 12:01AM tonight will pay the 10% tariff rate, not the higher 25% rate that goes into effect after that time
- (CN) China PBOC Adviser Ma Jun: US tariffs could cut GDP growth by 0.3%
- (CN) China PBoC sets yuan reference rate: 6.7912 v 6.7665 prior (weakest yuan fix since late Jan 2019)
- (CN) China PBoC Open Market Operation (OMO): Skips for second straight session: Net injection: CNY0B v CNY0B prior
- Sinopec: Suspends Iran oil purchases for May as US sanction waivers end (Chinese Press)
- (HK) IMF now sees Macau 2019 GDP growth at 4.3% v 5.3% in late Feb
Japan
- Nikkei 225 opened +0.1%
- (JP) Bank of Japan (BOJ) Summary of Opinions for Apr 23 and 24 meeting: Further declines in interest rates could aggravate demerits of monetary easing more than boosting economy
- (JP) JAPAN MAR REAL CASH EARNINGS Y/Y: -1.9% V -1.1%E (biggest drop since June 2015); LABOR CASH EARNINGS Y/Y: -2.5% V -0.5%E (biggest drop since June 2015)
- (JP) Magnitude 6.3 earthquake strikes Southern Japan; no tsunami threat – Japanese media
Korea
- Kospi opened +0.8%
- (KR) US Pentagon: Launches by North Korea earlier on Thursday were of multiple ballistic missiles that flew 300 KM into the ocean
- (KR) Bank of Korea (BOK) speculated to have sold US dollars in order to slow decline in Korean Won (KRW)
- (KR) South Korea Fin Min: Monitoring where there is herd behavior in FX offshore, won’t sit back if there is any herd behavior in FX
- (KR) Bank of Korea: Uncertainty related to US-China trade talks is rising; will cooperate with government to stabilize markets
- (KR) South Korea Fin Min: Reiterates will respond to volatilities that may stem from US/China trade talks, monitoring markets ‘around the clock’
- (KR) South Korea OECD does not expect hit 2019 or 2020 GDP targets – South Korea Press
Other
- (MY) Malaysia Mar Industrial Production Y/Y: 3.1% v 2.3%e
- (VN) Reportedly US Treasury considering labeling Vietnam as a currency manipulator and is also looking at other trading partners as potential FX manipulators – press
Levels as of 1:20 ET
- Nikkei 225, -0.6%, ASX 200 +0.2%, Hang Seng +0.7%; Shanghai Composite +1.4%; Kospi flat
- Equity Futures: S&P500 -0.4%; Nasdaq100 -0.5%, Dax -0.5%; FTSE100 +0.6%
- EUR 1.1236-1.1213 ; JPY 110.05-109.68 ; AUD 0.7019-0.6978 ;NZD 0.6614-0.6583
- Gold +0.1% at $1,286,/oz; Crude Oil +0.5% at $61.98/brl; Copper +0.3% at $2.774/lb
