Modest Equity Gains Seen After Rise On Wall Street

Dec 13 21, 06:32 GMT

General trend

Japan’s Q4 Tankan large company indices generally missed ests; BOJ decision is due on Fri. (Dec 17th).
USD Index has moved slightly higher after Friday’s decline.
UST yields rise in Asia.
BOJ acts amid rise in short-term rates by buying ¥2.0T in bonds.
NZIER: Consensus forecasts for NZ show weaker near-term outlook [reminder: NZ Q3 GDP data is due on Dec 16th (Thurs.)].
HKMA said it will continue to withdraw liquidity.
US equity FUTs have remained modestly higher.
Nikkei and S&P ASX 200 have remained modestly higher.
Hang Seng pared gain after rising >1.5%.
Shanghai Composite rose by 1% during morning trading.
Various central banks are due to meet this week (including US Fed, ECB, BOE and BOJ).

Headlines/Economic Data

Australia/New Zealand

ASX 200 opened +0.2%.
SXY.AU Confirms to be acquired by Posco at A$4.60/share in cash via a scheme of arrangement.
BKW.AU Guides H1 property EBIT A$290-310M (record levels); acquires 121 hectares in South West Sydney, no terms disclosed.
(NZ) New Zealand NZIER Quarterly Survey of Economists see 2021/22 GDP at 4.3% (prior 4.5%); 2022/23 GDP 4.6% (prior 4.5%).

Japan

Nikkei 225 opened +0.9%.
(JP) JAPAN Q4 TANKAN LARGE MANUFACTURING INDEX: 18 V 19E; OUTLOOK SURVEY: 13 V 19E, Large All-industry Capex: 9.3% v 9.8%e.
(JP) JAPAN NOV CORE MACHINE ORDERS M/M: 3.8% V +1.8%E; Y/Y: 2.9% V 4.2%E.
(JP) Japan PM Kishida: Will secure budget to revive economy during emergency.
(JP) Bank of Japan (BOJ) to buy ¥2.0T in bonds with repurchase agreements [first operation since 2006, follows rise in Japanese repo rates].

Korea

Kospi opened +0.3%.
005490.KR Confirms spinoff of steel business (to keep unlisted), to transition to holding company, targeting to triple enterprise value by 2030; changes to go into effect March 1st.
(KR) South Korea Dec 1-10th Exports Y/Y: 20.4% v 29.3% prior; Imports Y/Y: 42.3% v 59.0% prior.
(KR) South Korea and Australia sign critical mineral supply, and defense industry MOU and clean energy partnership.
(KR) South Korea Fin Min Hong: To begin discussions on process to join CPTPP.
(KR) South Korea sells KRW1.0T in 10-year bonds; Avg Yield: 2.175% v 2.305% prior; bid-to-cover 2.97x.
(KR) Bank of Korea report: Need to “steadily adjust” high levels of leverage maintained to prop up the pandemic impacted economy as excessive indebtedness could result in financial instability and reduce future policy room.

China/Hong Kong

Hang Seng opened +1.0%; Shanghai Composite opened +0.6%.
(CN) Shanghai Sec News: Multiple banks mention they will not allow investors to purchase funds suggested by algorithms after Govt updates to rules.
(CN) China PBOC sets Yuan reference rate: 6.3669 v 6.3702 prior.
388.HK Expected that Hong Kong Exchange will announce relaxed SPAC rules during Dec, Rules would change investor qualifications, dilution ceilings and shareholder voting on de-SPAC transactions.
(CN) Certain China property developers are seeking to sell assets to buyers in Hong Kong, cites the Chairman of Far East Consortium – HK press.
3333.HK Bondholders settle in for a lengthy restructuring process – FT.
(CN) Economists expect that China will add fiscal stimulus starting early 2022 – press.
(HK) Hong Kong Monetary Authority: Will increase issuance of Exchange fund bills by HK$40B over 8 tenders.
(CN) China Merchants Bank, China Guangfa Bank and China CITIC Bank have halted purchase of mutual fund products on their robo-advisory platforms due to a change in regulation – Shanghai Securities News.
(CN) At the China Central Economic Work Conference, indicated will implement a new system for Stock Issuance Registration in 2022 (moves pilot program into full effect).
(CN) China allocates 2022 early batch bond quota.
(CN) China PBOC Open Market Operation (OMO): Sells CNY10B in 7-day reverse repos v CNY10B prior; Net CNY0B v Net CNY0B prior.

Other

(TH) Bank of Thailand (BOT) Gov Sethaput: May be upside to 0.7% GDP growth during 2021; Decisions less dictated by US Fed response, not worried about CPI.

North America

MA VIsa and Mastercard said to be pressured from large retailers over their transaction fees – UK press.
Amazon: Statement on Kentucky Tornados: Assisting emergency responders as needed; Company worked quickly to ensure as many employees and partners could arrive at designated place update.
FedEx: Spokesperson said severe weather across the Central US last night impacted Express operations at co’s Memphis (Tenn.) Hub; co’s crew are safe; Company has implemented contingency plan, diverted several flights to other cities.

Europe

(UK) UK raised COVID alert level to 4 from 3, cited omicron variant – press.
(UK) Dec Rightmove House Prices M/M: -0.7% v -0.6% prior; Y/Y: 6.3% v 6.3% prior.
(FR) France drops threat of trade war with UK, after Channel Islands and UK Govt agree to more fishing licenses – press.
(GR) Greece central bank said to be planning an appeal for its bonds to remain eligible for new European Central Bank purchases after March when the bond buying scheme is expected to end – press.

Levels as of 00:15ET

Hang Seng +0.8%; Shanghai Composite +0.8%; Kospi +0.4%; Nikkei225 +0.8%; ASX 200 +0.4%.
Equity Futures: S&P500 +0.4%; Nasdaq100 +0.4%, Dax +0.3%; FTSE100 +0.2%.
EUR 1.1320-1.1292; JPY 113.58-113.31; AUD 0.7177-0.7159; NZD 0.6804-0.6787.
Commodity Futures: Gold +0.1% at $1,787/oz; Crude Oil +1.2% at $72.53/brl; Copper +0.6% at $4.31/lb.