General Trend
- Gainers in Shanghai include Consumer Staples, Financial and IT firms; Tech and Financial firms also rise in Hong Kong
- Topix Marine Transportation, Banks and Electric Appliances indices are among the decliners; Gainers include Air Transportation and Real Estate firms
- Australian Financial firms rise; Energy cos. move lower; Link Administration rises over 20% on takeover offer
Headlines/Economic Data
Australia/New Zealand
- ASX 200 opened flat
- (AU) Australia Treasurer Frydenberg: Would like to see Australia states spend more, do additional reform
- Australia Stock Exchange (ASX): ASX updates are not pushing on the new ASX website; announcements will still be available through brokers and news agencies
- (NZ) Reserve Bank of New Zealand (RBNZ) buys NZ$380M v NZ$260M prior in government bonds as part of QE v NZ$380M sought
China/Hong Kong
- Hang Seng opened +0.4%, Shanghai Composite opened +0.5%
- (CN) China PBOC to cut the FX risk reserve ratio to 0% [from 20%], effective from Monday (Oct 12th); The move relates to certain FX forwards trading by financial firms – financial press [Reminder: In Sept 2017 PBoC removed the reserve conditions for yuan forwards trade from 20% to zero; Analysts then noted that the removal of reserve requirement showed China was getting uncomfortable with recent yuan strength]
- (CN) China PBOC sets Yuan reference rate: 6.7126 v 6.7796 prior [Reminder: China PBOC expected to set the yuan mid-point at 6.7052]
- (CN) China President Xi to visit Shenzhen this week [on Oct 14th], Shenzhen to ease foreign investment entry limit related to high technology; China to support digital yuan trial in Shenzhen – SCMP
- (CN) China Central Bank (PBoC) Gov Fan: Deteriorating US-China relations are presenting huge risks to the tech supply chain security for Domestic Financial Network
- (HK) Hong Kong Chief Exec Lam: To delay Annual policy Address on Wednesday (Oct 14th); Now aims to deliver policy address by end of Nov; Policy address will include supporting measures from China
- (HK) Monday (Oct 12th) is the Trump administration’s deadline to issue a report to Congress related to HK and sanctioned individuals – SCMP
- (CN) China PBOC Deputy Gov Chen Yulu said China to prevent inflation, debt rise and asset bubbles; to accelerate digital currency trial in ‘controllable’ manner – local press
- (CN) China PBoC Open Market Operation (OMO): skips reverse repos v Skips reverse repos prior; Net drain CNY60B v Net drain CNY90B prior
Japan
- Nikkei225 opened -0.1%
- (JP) Japan Aug Core Machine Orders M/M: +0.2% v -1.0%e (2nd consecutive increase); Y/Y: -15.2% v -15.6%e
- (JP) Japan Sept Bank Lending Ex-Trusts Y/Y: 6.2% v 6.6% prior; Incl Trusts Y/Y: 6.4% v 6.7% prior
- (JP) BoJ: Demand for digital currency could rise rapidly, vital to be ready for change in digital currency situation – Central Bank Digital Currency (CBDC) report (from Oct 9th)
Korea
- Kospi opened +0.5%
- LG Chem [051910.KR]: Reports Q3 (KRW) Op 902.1B v 348.8B y/y (vs 746Be); Rev 7.51T v 6.90T y/y (vs 8.2Te)
- (KR) South Korea has eased its social distancing alert to level 1 from 2 – press
- (KR) South Korea Oct 1-10th Exports Y/Y: -28.8%; Imports Y/Y -19.5%; Semiconductor exports +11.2% y/y; Exports to China -20.9% y/y
- (KR) On Saturday (Oct 10th), North Korea unveiled a new ICBM at its military parade (as speculated) – Press
Other Asia
- (TH) Thailand Fin Min Termpittayapaisith [new Finance Min]: To closely monitor Baht currency (THB)
North America
- (US) White House spokesperson Farah: wants to keep coronavirus aid number below $2T (from Oct 9th)
- (US) US stimulus talks are at ‘impasse’; both Democrats and Republicans are said to have shown resistance to Trump’s latest stimulus offer; Some Republicans raised concerns about the cost of Trump’s stimulus offer of ~$1.9T. – US financial press (from Oct 11th)
Europe
- (IE) ECB’s Lane (Ireland, chief economist): important not to put exchange rate at center of policymaking, as FX is just one issue affecting inflation – US press interview
- (LY) Libya ends force majeure related to the Sharara oil field (capacity of up to 300K bpd, largest oil field in Libya)
- (UK) UK Follow Up: PM Johnson and Cabinet to have call related to lockdown restrictions; PM Johnson is expected to ban overnight stays in COVID-19 hot spots located in the Northern part of the country (as speculated) – UK media
- (UK) Liverpool CIty Regional Leaders: Confirms government has decided that further measures and closures will apply to Liverpool; pubs, bars, betting shops, adult gaming centers and gyms to close
- (UK) Said that EU Leaders are going to insist on tough enforcement powers in a Brexit deal – FT
Levels as of 1:20 ET
- Nikkei 225, -0.3%, ASX 200 +0.5% , Hang Seng +2.3%; Shanghai Composite 2.5% ; Kospi +0.4%
- Equity S&P500 Futures: +0.3%; Nasdaq100 +0.5%, Dax +0.4%; FTSE100 +0.2%
- EUR 1.1826-1.1808 ; JPY 105.80-105.46 ; AUD 0.7241-0.7212 ;NZD 0.6669-0.6651
- Gold +0.4% at $1,934/oz; Crude Oil -1% at $40.20/brl; Copper -0.2% at $3.0772/lb
