RBNZ Started Bond Purchases Under QE Program

Mar 25 20, 05:56 GMT

General Trend:

Japanese REIT, Marine Transportation, Iron & Steel, Securities and Insurance indices are all moving higher by over 5%
Automakers in Japan track the earlier strength seen in the US auto sector
Nikkei-weighed Softbank rises by over 6%, adds to the gains seen on Monday and Tuesday’s sessions
Shanghai Composite Consumer Discretionary index rises over 2.5% in early trading, most other sectors also move higher
Sectors moving higher in Australia include Resources, Financial and Energy; Consumer Staples and Telecom sectors decline in Australia
South Korea to ease the FX liquidity coverage ratios for banks, the move is seen as another attempt to reduce the shortage of foreign currency
CME to launch new gold futures contract with expanded delivery; London Bullion Market Association (LBMA) is said to have offered support to the CME to facilitate the physical delivery of gold in NY

Headlines/Economic Data

Australia/New Zealand

ASX 200 opened +1.8%
VAH.AU Cuts domestic capcity by 90%, grounding additional 125 planes; keeping 10% domestic capacity for transportation of essential services, critical freight and logistics; to stand down 80% of workforce
(NZ) Reserve Bank of New Zealand (RBNZ) proposes buying NZ$250M in govt bonds as part of QE
(AU) Reserve Bank of Australia (RBA) offers to buy total of A$2.0B in bonds (target of A$2.0B) v A$4.0B prior
(NZ) New Zealand Feb Trade Balance (NZ$): 0.6B v 0.5Be
NUF.AU Reports H1 continued operations (A$) underlying net -114.5M v -50.7M y/y; underlying EBITDA -5.6M v +48.6M y/y; Rev 901.1M v 1.0B y/y
(AU) Reserve Bank of Australia (RBA): Excess cash at exchange settlement (ES) accounts at A$53.6B v A$43.6B prior
(AU) Reserve Bank of Australia (RBA) adds A$2.43B to banking system through repos v A$6.88B prior
(NZ) Reserve Bank of New Zealand (RBNZ) purchases NZ$250M in bonds v NZ$250M sought (1st QE operations)
(AU) Australia PM Morrison: Appointing Nev Power to lead coronavirus commission; National Cabinet to meet again Wednesday night, no press conference planned after
(AU) Reserve Bank of Australia (RBA) to offer $10B in 84-day USD repo operation on March 26th

Japan

Nikkei 225 opened +2.0%
(JP) Bank of Japan (BOJ Summary of Opinions from March 16th emergency policy meeting: Appropriate for the Bank to enhance monetary easing, with a view to doing its utmost to ensure smooth corporate financing and maintaining stability in financial markets, thereby preventing firms’ and households’ sentiment from deteriorating
(JP) JAPAN PM ABE CONFIRMS THAT TOKYO OLYMPIC GAMES TO BE POSTPONED FOR ONE YEAR
1605.JP To review investment plans and reduce costs due to coronavirus, do not know how long it will affect oil prices
(JP) Japan Ruling Party (LDP) Senior Official: Desirable to have size of economic steps more than ¥56.8T in project base at the time of Lehman shock
(JP) Japan Government Pension Fund (GPIF) said to make allocation changes to portfolio; including raising foreign bond allocation – financial press
(JP) Bank of Japan (BOJ): Offers to sell ¥2.0T in JGBs in repo agreement that begins on March 31st; offers to sell ¥400B in JGBs in repo agreement that begins on March 26th

Korea

Kospi opened +3.6%
(KR) South Korea reports 100 additional coronavirus cases in the last 24-hours v 76 prior; Total 9,137 v 9.037 prior; total deaths 126 v 120 prior
(KR) South Korea Fin Min Kim: Fair to say budget surplus achieved in 2019 has already been used up; Govt to relax liquidity coverage ratio rule for banks temporarily; govt will prepare various layers of tools to inject FX liquidity into the market
020560.KR Makes 10.5K employees take 15-days unpaid leave in April in response to coronavirus – Yonhap
(KR) South Korea Fin Min Kim: Fair to say budget surplus achieved in 2019 has already been used up; Govt to relax liquidity coverage ratio rule, levy on currency borrowing for banks temporarily; govt will prepare various layers of tools to inject FX liquidity into the market
(KR) Bank of Korea (BOK) to supply USD liquidity next week via swap line with US – press

China/Hong Kong

Hang Seng opened +2.6%; Shanghai Composite opened +1.9%
(CN) China National Health Commission Coronavirus Update for March 24th: 47 additional cases (all imported) v 78 prior; Additional deaths: 4 v 7 prior; Hubei: 0 additional cases v 1 prior; additional deaths: 3 v 7 prior
(CN) China President Xi to participate virtual G20 summit on March 26th
(CN) China PBOC sets Yuan reference rate: 7.0742 v 7.0999 prior
(CN) China PBoC Open Market Operation (OMO): Skips reverse repo operations for the 26th consecutive session, Net CNY0B v CNY0B prior
(CN) China PBOC to conduct CNY5.0B central bank bill swap (CBS) operation on today’s session v CNY5.0B prior at 2.35% v 2.35% prior
(CN) China NDRC: Encourages China local govts to stockpile poultry and aquaculture products temporarily
(CN) China PBOC in talks to cut rate that banks pay on savings accounts – FT

North America

(US) Weekly API Crude Oil Inventories: -1.3M v -0.4M prior
(US) President Trump: Reiterates would be great to open by Easter, looking at data – coronavirus update; won’t hesitate to invoke Defense Production Act
(US) White House economic adviser Kudlow: Stimulus bill would be the single largest main street assistance package in the history of the US
(US) President Trump considering a 90-day deferral of tariffs on all imported goods from “around the world” – US Financial Press
BA Said to plan to restart 737 Max production by May – financial press
(US) TTN March 24th Avg Traffic Intensity Index in Select US cities y/y: 9.0% v 8.8% prior (1st increase in 9 days)

Europe

(IT) Italy PM Conte: denies reports that lockdown will be extended to July 31st; lockdown will be lifted well before then; Hope very soon to be able to loosen lockdown restrictions
TKA.DE Reaches agreement with union, IG Metall, to cut 3,000 jobs at its steel unit due to coronavirus

Levels as of 1:15ET

Hang Seng +1.6%; Shanghai Composite +1.4%; Kospi +3.5%; Nikkei225 +6.4%; ASX 200 +5.5%
Equity Futures: S&P500 -1.5%; Nasdaq100 -1.9%, Dax -0.7%; FTSE100 +0.4%
EUR 1.0824-1.0761; JPY 111.56-110.75 ;AUD 0.6035-0.5937; NZD 0.5884-0.5795
Commodity Futures: Gold +0.5% at $1,668/oz; Crude Oil+3.3 % at $24.77/brl; Copper -0.9% at $2.18/lb