General Trend:

  • Chinese equities rise in early trading, on track for first gain in 3 sessions
  • Japanese chipmakers underperform amid focus on Huawei, Chinese chipmakers and Samsung however outperform
  • Chinese rare-earth companies rise on speculated import restrictions
  • Chinese smartphone maker Xiaomi rises less than 2% following earnings report
  • Softbank rises in Japan on hopes that Sprint/T-Mobile merger is approved
  • Australia financial sector rises after regulator (APRA) moves to ease mortgage rules , continued momentum after surprise election results
  • Woolworth’s declines in Australia amid cautious broker commentary
  • Australian building materials firm James Hardie (exposed to US housing market) rises after results and guidance
  • RBA Gov Lowe signals possibility for June rate cut
  • Big three Aussie banks now all call for June rate cut
  • Aussie yields remain above recent lows despite comments by Lowe
  • Some analysts examine if mortgage-related move by APRA will ease some of the rate cut pressure on the RBA
  • Lowe: Move by APRA would complement, not substitute, monetary policy
  • China PBoC injected liquidity for the first time in 7 sessions
  • USD/CNH remains below 6.95 amid stability pledges out of China
  • Chinese bond yields rise as domestic equities and yuan gain
  • Chinese soymeal futures decline over 1.5% in the face of lingering trade worries
  • South Korea chip exports continued decline during first 20 days of May
  • US Fed Chair Powell did not comment directly on monetary policy, mentioned CLOs and leveraged loans
  • Singapore cut top end of 2019 GDP growth target range after mixed final Q1 GDP data; cut forecast for non-oil exports
  • Thailand cut 2019 growth forecast amid expectation for weaker exports
  • Technology companies react to temporary reprieve given to Huawei by US gov’t; Huawei itself plays down the importance of the move

Headlines/Economic Data

Australia/New Zealand

- advertisement -
  • ASX 200 opened +0.1%
  • (AU) RESERVE BANK OF AUSTRALIA (RBA) MAY MINUTES:OUTLOOK WOULD THUS BE LESS FAVOURABLE WITHOUT AN EASING IN POLICY OVER NEXT 6 MONTHS (replacing prior wording of not a strong case for near term adjustment In monetary policy)
  • (AU) RBA GOV LOWE SPEECH IN BRISBANE: BOARD WILL CONSIDER CASE FOR RATE CUT IN JUNE
  • JHX.AU Reports FY19 Net $228.8M v $146.1M y/y; adj Op $300.5M v $301Me; Rev $2.51B v $2.05B y/y
  • (AU) APRA: Proposes to amend guidance on mortgages, proposes removing the minimum 7% mortgage rate buffer
  • (AU) Australia Treasurer Frydenberg: Tax cuts will be delivered as soon as passed by parliament; affirms budget surplus target

Japan

  • Nikkei 225 opened -0.4%
  • 8028.JP Suing to dissolve 15 year JV partnership with Ting Hsin Food Conglomerate – Nikkei
  • 8306.JP Mitsubishi UFJ Financial group reportedly reducing MUFG Bank branches by 35% by FY23 (had prior plans to close 20%) – Nikkei
  • (JP) Japan Fin Min Aso: GDP at 2.1% and two quarters of growth “is not bad”; fundamentals continue to be firm
  • (JP) Japan Q1 Housing Loans Y/Y: 2.4% v 2.4% prior
  • (JP) Japan Econ Min Motegi: Japan and the US will hold working level trade talks today; no decision on Lighthizer talks ahead of Trump’s visit
  • (JP) Bank of Japan (BOJ) Gov Kuroda: Bond buying is to reach price target, no finance Govt debt
  • 6758.JP CEO Yoshida announces mid-term corporate strategy for FY19-21: planning to increase FY20 CAPEX to ¥1.1-1.2T, to stably raise dividend over the long term, want to buyback in an agile manner

Korea

  • Kospi opened +0.1%
  • (KR) South Korea Apr PPI Y/Y: 0.6% v 0.5% prior (2nd consecutive increase)
  • (KR) Bank of Korea (BOK) Gov Lee: Not considering currency redenomination; BOK steps to cap won decline not a problem – Yonhap (overnight)
  • (KR) South Korea May 1-20th Exports y/y: -11.7% v -8.7% prior; Imports y/y: -0.1% v -1.2% prior; Chip exports -33% y/y; Car exports +12.6% y/y
  • 005490.KR US will further reduce tariff on cold rolled steel – Yonhap

China/Hong Kong

  • Hang Seng opened -0.4%; Shanghai Composite opened -0.1%
  • (CN) Reportedly China to suspend business with all suppliers who agreed to halt supplying Huawei; may temporarily hike tariffs for Apple; All China trade talks with U.S. said to be halted – Money China twitter (after the close yesterday)
  • (CN) US Commerce Dept: confirms plans in filing to revise ‘entity list’ restrictions on Huawei so existing customers can maintain networks
  • Huawei Founder Ren: Won’t rule out use of US chips, 90-day license [issued by US] does not make much sense for Huawei; Infineon has not stopped supplying chips to Huawei (refutes recent press report) – Chinese Media
  • (CN) China PBoC Open Market Operation (OMO): Injects CNY70B in 7-day reverse repos v skips prior: Net: CNY80B v CNY0B prior (1st injection after 6 skips)
  • 1913.HK Starts strategic review on wholesale channels, considers it essential to ensure greater consistency in pricing policies across retail and digital channels
  • (CN) Not a large chance for the yuan to experience disorderly devaluation, necessary to make counter cyclical adjustments of yuan; Risk of ‘over-depreciation’ of yuan (CNY) are emerging over the short-term – China Securities Journal Front Page Commentary
  • (CN) China is using $25T in equity stakes in state-owned enterprises (SOE) to address pension hole – SCMP
  • (CN) China PBoC sets yuan reference rate: 6.8990 v 6.8988 prior
  • (CN) China said to have extended ban on imports of medium to heavy rare earths, including dysprosium oxide and terbium oxide, from Myanmar; raised rare earth import tariffs from the US to 25% from 10% – Chinese press

Other Asia

  • (SG) Singapore Q1 Final GDP Q/Q: 3.8% v 2.3%e; Y/Y: 1.2% v 1.4%e; Cuts 2019 GDP estimated range: 1.5-2.5% (prior 1.5-3.5%)
  • (TH) Thailand Q1 GDP Q/Q: 1.0% v 1.3%e; Y/Y: 2.8% (slowest pace in 4-yrs) v 2.8%e
  • (SG) Monetary Authority of Singapore (MAS): Current monetary policy stance is appropriate; expects inflation pressures to be stable this year

North America

  • (US) Fed Chair Powell: No direct comments on interest rates; Sees business lending risk as moderate; job creation is strong and wages are rising in context of muted inflation pressures – Speech on assessing risks to the financial system
  • (US) Fed’s Clarida (moderate, voter): Full employment may go at least as low as 3.6%; labor market may not be operating beyond full employment (US session)

Europe

  • (IR) Iran President Rouhani: In favor of talks and diplomacy, but under current conditions do not accept

Levels as of 1:20 ET

  • Nikkei 225, -0.3%, ASX 200 +0.2%, Hang Seng -0.1%; Shanghai Composite +1.4%; Kospi +0.7%
  • Equity Futures: S&P500 +0.4%; Nasdaq100 +0.5%, Dax +0.1%; FTSE100 +0.3%
  • EUR 1.1173-1.1162 ; JPY 110.26-110.01 ; AUD 0.6929-0.6885 ;NZD 0.6544-0.6517
  • Gold -0.2% at $1,275/oz; Crude Oil +0.4% at $63.45/brl; Copper +0.4% at $2.740/lb
Previous articlePolitical Headlines Remain In The Spotlight
Next articleOffshore Yuan Hitting 7 Top Of Headlines, But What About Dollar Index Above 100?
All information provided by Trade The News (a product of Trade The News, Inc. "referred to as TTN hereafter") is for informational purposes only. Information provided is not meant as investment advice nor is it a recommendation to Buy or Sell securities. Although information is taken from sources deemed reliable, no guarantees or assurances can be made to the accuracy of any information provided. 1. Information can be inaccurate and/or incomplete 2. Information can be mistakenly re-released or be delayed, 3. Information may be incorrect, misread, misinterpreted or misunderstood 4. Human error is a business risk you are willing to assume 5. Technology can crash or be interrupted without notice 6. Trading decisions are the responsibility of traders, not those providing additional information. Trade The News is not liable (financial and/or non-financial) for any losses that may arise from any information provided by TTN. Trading securities involves a high degree of risk, and financial losses can and do occur on a regular basis and are part of the risk of trading and investing.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.