General Trend:
- Fiat withdraws merger proposal for Renault, cites politics in France; Nissan shares decline
- Softbank rises over 3% in Japan, tracks gains on the Nasdaq
- Chinese equity markets decline in early trading amid losses in IT shares
- China expected to issue 5G licenses later today, telecom services firms decline ahead of the announcement amid profit taking
- China’s Hengfeng Bank has been in the headlines
- PBOC steps up MLF, aimed at offsetting maturities and supporting banks
- Singapore gov’t moves to support local property market prices
- ECB rate decision expected later today
- India Central Bank is expected to cut rates at later today policy meeting
- G20 Finance Ministers meetings expected to be held over the weekend
Headlines/Economic Data
Australia/New Zealand
- ASX 200 opened +0.4%
- (AU) Australia Apr Trade Balance (A$): 4.87B v 5.0Be (16th straight surplus)
- (NZ) New Zealand May Commodity Price Index 0.0% v 2.6% prior
- (NZ) New Zealand announces dairy industry regulations changes: Proposed to allow Fonterra to refuse to supply milk to large rivals
China/Hong Kong
- Shanghai opened flat, Hang Seng +0.2%
- (CN) China PBoC offers CNY500B 1-year medium term lending facility (MLF) at 3.3% v 3.3% prior; Of the total MLF, CNY37B in funds to be offered to small and medium-sized banks
- (CN) China PBoC Shanghai Branch said Baoshang Bank credit risk is ‘isolated’ case; Small and medium-sized banks are operating ‘normally’ – financial press
- (CN) China Hengfeng Bank is targeting strategic investors, may receive funds from local government – Chinese Press
- (CN) PBoC Advisor said to call for more debt controls – China Daily
- (CN) China PBoC Open Market Operation (OMO): Injects CNY10B in 7-day reverse repos v CNY60B prior
- (CN) China PBoC sets yuan reference rate: 6.8945 v 6.8903 prior
- (CN) China reportedly to grant 5G licenses later today; expected to grant to China Unicom, China Broadcasting, China Telecom, and China Mobile – Chinese Press
- (CN) China Association of Automobile Manufacturers (CAAM) said to be calling for stimulus to revive auto sales – financial press
- CWT International (HNA unit): Announces its receivers have commenced due diligence over charged assets, the assets have not been disposed by the receivers; default caused cross default of UK property loan which may be due for immediate repayment
Japan
- Nikkei opened -0.2%
- (JP) Japan Fin Min Aso to meet with US Treas Sec Mnuchin to discuss currency clause, meeting to occur on sidelines of this weekend’s G20 meetings – Japanese Press
Korea
- Kospi closed for holiday
- (KR) China Pres Xi to visit South Korea in June, meeting expected to occur before G20 meeting in Japan (June 28-29th) – South Korea Press
Other
- (SG) Singapore government to reduce supply of private housing units in H2 2019, notes demand for land from developers has moderated
- (SG) Singapore May PMI: 52.1 v 53.3 prior
- (TH) Thailand Parliament elects PM Prayuth to new term
North America
- (MX) US AND MEXICO TRADE OFFICIALS FAIL TO REACH DEAL ON TARIFFS AND IMMIGRATION DURING WEDS MEETING – CNBC
- (US) US President Trump: Talks with Mexico will resume on Thursday; Tariffs to take effect on Monday if no agreement is reached
- (US) Senate Fin Chair Grassley (R-IA): thinks announcement could be made Thurs night about Mexico tariffs deal; predicts US won’t impose tariffs on Mexican imports
- (MX) Mexico Foreign Min Ebrard: Today’s meeting focused on migrations proposals, did not discuss tariffs; Tomorrow’s meeting to seek common ground
- (MX) Fitch cuts Mexico sovereign rating one notch to BBB from BBB+; outlook revised to Stable
- (MX) Moody’s revises Mexico sovereign rating outlook to Negative from Stable; affirms A3 rating
- (US) Fed’s Brainard (voter, dove): We will be prepared to adjust policy to sustain growth; will monitor data – Yahoo interview
- IMF’s Lagarde: Does not see threat of global recession brought on by US tariff threats but tariffs threats could slow growth further and increases uncertainties
Levels as of 1:20 ET
- Nikkei 225, +0.2%, ASX 200 +0.5%, Hang Seng flat; Shanghai Composite -0.8%; Kospi closed
- Equity Futures: S&P500 -0.1%; Nasdaq100 flat, Dax -0.2%; FTSE100 +0.2%
- EUR 1.1233-1.1219 ; JPY 108.48-108.18 ; AUD 0.6974-0.6962 ;NZD 0.6632-0.6616
- Gold flat at $1,333/oz; Crude Oil +0.3% at $51.82/brl; Copper -0.1% at $2.624/lb
