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Trump Told Republicans To Stop Talks On Fiscal Stimulus Until After The Election

General Trend

  • Australian Consumer cos. are among the gainers following the recent budget announcement; Financials also rise
  • Pharma and Air Transportation firms are among the decliners in Japan, Marine Transportation and Information/Communication cos. rise
  • Tech and Property firms rise in Hong Kong
  • Australia 3-year bond yield hits record low, markets continue to price in easing at the RBA’s Nov policy meeting
  • Shanghai markets are closed Oct 1-8th for holiday
  • China Sept FX reserves might be released on Oct 7th
  • Samsung Electronics might issue Q3 earnings guidance on Thursday (Oct 8th), Taiwan Semi might also issue Sept Sales [US financial press]

Headlines/Economic Data

Australia/New Zealand

  • ASX 200 opened -0.2%
  • (AU) Australia budget raises FY20/21 budget deficit to A$213.7B compared to A$184.5B prior projection (from Oct 6th)
  • (AU) Australia Debt Agency (AOFM): Affirms expects 2020/21 Treasury Bond issuance at ~A$240B [has already undertaken issuance equal to A$117B]; no further new bond lines planned for 2020; to sell A$3-4B in bonds per week for rest of 2020
  • (AU) Moody’s on Australia: Aaa sovereign rating consistent with budget [Reminder: All 3 major ratings agencies currently rate Australia at AAA]
  • (AU) Australia total payroll jobs change between Sept 5th and Sept 19th: +0.3%; weekly total wages +0.8%
  • (AU) Australia sells A$2.5B v A$2.5B indicated in 1.00% Nov 2031 bonds, avg yield 0.8975%, bid to cover 3.9x
  • (AU) Australia Sept AiG Performance of Services Index: 36.2 v 42.5 prior
  • (AU) Victoria state (Australia) reports 6 additional coronavirus cases v 15 prior; 2 additional deaths
  • (NZ) Reserve Bank of New Zealand (RBNZ) buys NZ$410M v NZ$380M prior in government bonds as part of QE v NZ$410M sought

China/Hong Kong

  • Hang Seng opened +0.1%, Shanghai Composite closed for holiday
  • (HK) Hong Kong Aug PMI (whole economy): 47.7 v 44.0 prior (31st month of contraction)
  • (HK) Hong Kong government said to consider closing bars again – HK press
  • (CN) China PBOC Deputy Gov Fan Yifei issued update on the central bank’s digital currency pilot program at the Sibos 2020 conference, noted over 113K consumer digital wallets and ~8,850 corporate digital wallets have been opened by the bank – Coindesk

Japan

  • Nikkei 225 opened -0.7%
  • (JP) Bank of Japan (BOJ) Gov Kuroda: Full Fledged recovery of global economy is much further away
  • (JP) Japan Sept Foreign Reserves: $1.39T v $1.40T m/m
  • (JP) Japan Aug Preliminary Leading Index: 88.8 v 89.0e; Coincident Index: 79.4 v 79.4e

Korea

  • Kospi opened -0.6%
  • (KR) South Korea Aug Foreign Reserves: $421B v $419B prior (record high)
  • (KR) Fitch affirms South Korea sovereign rating at AA-; Outlook Stable
  • (KR) South Korea confirms 114 additional coronavirus cases v 75 prior; 3 additional deaths

Other Asia

  • (SG) Monetary Authority of Singapore (MAS): To issue semi-annual Monetary Policy statement on Oct 14th (Wednesday)

North America

  • (US) PRESIDENT TRUMP: I HAVE DIRECTED REPUBLICANS TO STOP NEGOTIATING ON FISCAL STIMULUS UNTIL AFTER THE ELECTION; Nancy Pelosi is asking for $2.4 Trillion Dollars to bailout poorly run, high crime, Democrat States, money that is in no way related to COVID-19. We made a very generous offer of $1.6 Trillion Dollars and, as usual, she is not negotiating in good faith.
  • (US) Follow Up: President Trump: Calls on Congress to approve $25B for Airline support; Also asks for $135B for the PPP (Paycheck Protection Program); willing to sign bill authorizing just stimulus checks
  • (US) House Speaker Pelosi: Trump’s decision to call off relief bill talks shows the White House is in complete disarray
  • (US) Senate Majority Leader McConnell: Speaker Pelosi never made a reasonable offer regarding stimulus talks
  • (US) President Trump: Authorizes declassification of Russia Probe Documents and Clinton Email Probe

Europe

  • (UK) Chancellor of the Exchequer Sunak (Fin Min) to have the power to block companies from listing on the London Stock Exchange (LSE) due to national security concerns – UK Press

Levels as of 1:20 ET

  • Nikkei 225, -0.2%, ASX 200 +1.3% , Hang Seng +0.6%; Shanghai Composite closed ; Kospi +0.6%
  • Equity S&P500 Futures: +0.2%; Nasdaq100 +0.1%, Dax +0.8%; FTSE100 -0.1%
  • EUR 1.1740-1.1725 ; JPY 105.72-105.60 ; AUD 0.7121-0.7095 ;NZD 0.6601-0.6575
  • Gold -1.2% at $1,886/oz; Crude Oil -1.8% at $39.93/brl; Copper +0.5% at $2.9383/lb

 

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