HomeContributorsFundamental AnalysisRBA Ro Extend $100 Billion QE In October

RBA Ro Extend $100 Billion QE In October

General Trend

  • Asian markets are higher after the mostly positive opens
  • Nikkei is near the middle of today’s range after opening higher by over 1% [Air Transportation index, Real Estate index and Oriental Land rose amid tourism support package; Other gainers included Pharma and Marine Transportation indices; Automakers rise amid weakness in Yen]
  • Shanghai Composite extended gains during the morning session [Consumer names outperformed]
  • Hang Seng also continued to rise after the higher open [TECH index has risen by over 2% (Xiaomi and Great Wall Motor rose on EV speculation; Baidu declined after drop in NY-listed shares); Property index also gained (Kaisa Group dropped on rights offering)]
  • HK Financial earnings are in focus (including ICBC, China Construction Bank, China Life and BoCom); Sinopec may also report
  • S&P ASX 200 moved higher after the flat open [Telecom and Resources indices outperformed]
  • Companies that may report during the NY morning include Accel Entertainment, Leju Holdings, LMP Automotive, Fang Holdings, ReneSola

Headlines/Economic Data

Australia/New Zealand

  • ASX 200 opened flat
  • (AU) Australia sells A$800M v A$800M indicated in 0.25% Nov 2024 bonds, avg yield 0.2523%, bid to cover 4.3x
  • (AU) Westpac: Sees Reserve Bank of Australia (RBA) extending QE by additional A$100B in Oct (previously saw A$50B)
  • (CN) China halts imports of Australia Hay – Global Times
  • (NZ) RBNZ buys NZ$140M v NZ$152M prior in government bonds as part of QE v NZ$140M sought
  • (NZ) Reserve Bank of New Zealand (RBNZ) offers to buy a total of NZ$430M in government bonds next week under QE program v NZ$630M prior

China/Hong Kong

  • Hang Seng opened +0.5%, Shanghai Composite +0.3%
  • (CN) China PBOC official: reiterates need to keep prudent monetary policy flexible
  • (CN) China PBOC Open Market Operation (OMO): Injects CNY10B in 7-day reverse repos v CNY10B in 7-day reverse repos prior; Net CNY0B v CNY0B prior
  • (CN) China PBOC sets Yuan reference rate: 6.5376 v 6.5282 prior (Weakest Yuan fix since first trading day of the year)
  • (CN) China PBOC to conduct CNY5.0B in 3-month Central Bank Bill Swap (CBS) operation on today’s session v CNY5.0B prior
  • (CN) China Ministry of Finance (MOF) Sells 3-month bills and 30-year bonds
  • (CN) China Copper Smelters group said to have not set a Q2 TC/RC Floor price – Press
  • (CN) Beijing (China) housing authorities said to act on speculation related to ‘school district houses’; certain real estate brokers are being inspected to determine if they misled buyers and drove up housing prices – Chinese press
  • (CN) World Bank: Sees China 2021 GDP growth at 8.1% (prior 7.9%), 2022 GDP growth seen at 5.4%
  • Xiaomi [1810.HK]: Xiaomi said to announce partnership with Great Wall Motor to make Electric Vehicles as soon as next week – Press

Japan

  • Nikkei 225 opened +1.2%
  • (JP) JAPAN MAR TOKYO CPI Y/Y: -0.2% V -0.2%E; CPI (EX-FRESH FOOD) Y/Y: -0.1% V -0.2%E (highest core reading since July 2020)
  • (JP) Japan said to be spending ¥300B to help local tourism industry – Press
  • (JP) Bank of Japan (BOJ) Establishes liaison and coordination committee on Digital Currency, holding first meeting today

Korea

  • Kospi opened +0.2%
  • (KR) IMF raises South Korea 2021 growth outlook to 3.6% from 3.1%
  • (KR) South Korea Mar Consumer Confidence: 100.5 v 97.4 prior
  • (JP) Japan Official Kishi: Missiles that were fired by North Korea yesterday are a new type – Japanese press

Other Asia

  • (TW) Some insiders related to Taiwan Central Bank said to call for changes to currency policy, noted moves to slow TWD appreciation is having negative economic impact – US financial press

North America

  • (US) President Biden: beginning to see new signs of hope for economy after stimulus bill passage; Majority of economic forecasters project above 6% growth this year; Made clear to China Prex Xi that the US was ‘not looking for confrontation’ but there will be ‘steep competition’; we’ll insist that China play by the rules; US needs to step up investment in order to compete with China; US and allies will hold China accountable on Taiwan, the South China Sea, and other issues – press conf
  • (US) White House: Tracking Suez Canal Situation closely
  • (US) Fed announces that banks that clear stress tests can resume dividends and buybacks after June 30th
  • (US) Fed’s Daly (non-voter, dove): US job market definitely ‘still in a ditch’; Should not be worried about inflation at this time; Negative interest rates not on my list of possible tools
  • Boeing [BA]: China Aircraft Leasing [1848.HK] to cut 737 Max order to 66 from 92 units
  • Aldel Financial [ADFU]: Cutting Blank Check IPO Size to $100M from $200M prior

Europe

  • (EG) Suez Canal stuck ship clearance reportedly could now take days to weeks – FT
  • (IT) Italy PM Draghi said to need to ask for additional borrowing in April – US financial press
  • (UK) PM Johnson receives Parliamentary support to loosen COVID lockdown measures – press
  • (UK) Trade talks between the US and UK Said to extend beyond deadline imposed by US – FT
  • (UK) Bank of England (BOE) FPC Said to be highlighting preparations for cyberattack stress tests – Local Press
  • (UK) China Foreign Ministry: to sanction 9 UK Officials and 4 entities [counter sanctions]; Reserves right to take additional measures

Levels as of 01:20 ET

  • Nikkei 225, +1.5%, ASX 200 +0.5% , Hang Seng +1.2%; Shanghai Composite +1.5% ; Kospi +1%.
  • Equity S&P500 Futures: +0.4%; Nasdaq100 +0.6%, Dax +0.1%; FTSE100 +0.6%.
  • EUR 1.1784-1.1763; JPY 109.31-109.13 ; AUD 0.7616-0.7575 ;NZD 0.6976-0.6947.
  • Gold flat at $1,724/oz; Crude Oil +1.1% at $59.22/brl; Copper +0.7% at $4.0240/lb.

 

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