Headlines/Economic Data
General Trend:
Steelmakers trade broadly lower after Trump Admin formally announces tariffs on aluminum and steel imports
USD/JPY hits 2-week low
(JP) BOJ Gov Kuroda: Will be considering exit around Fiscal 2019 because of the chances of hitting inflation target at that time – Parliament comments
China National People’s Congress to start on Monday, March 5th, will set economic targets for the coming year; Expected to keep GDP growth near or above 6.5% – Xinhua
Australia/New Zealand
ASX 200 opened -0.5%; closed -0.7%
ASX 200 Telecom Index -1.7%, Resources -1%, Energy -0.9%, Financials -0.5%
(AU) Australia Trade Min Ciobo: To seek exemption from US steel tariffs
(NZ) New Zealand Feb ANZ Consumer Confidence: 127.7 v 126.9 prior
(NZ) New Zealand Jan Building Permits M/M: +0.2% v -9.6% prior
(NZ) Citigroup pushes back RBNZ rate hike call: Now sees rates on hold until Q1 2019 vs prior expectation for rate hike in Q3 2018
China/Hong Kong
Hang Seng opened -1.4%, Shanghai Composite opened -1.8%
Hang Seng Energy Index -2%, Info Tech -1.9%, Financials -1.8%, Property/Construction -1.2%
Shanghai Composite Property Index trades at around flat levels
Chinese industry groups react to US decision to adopt sanctions on steel and aluminum: (CN) China Metals Association: China among nations likely to ‘retaliate’
(CN) China Iron and Steel Association (CISA) Official: US tariffs related to steel and aluminum are ‘stupid’ trade protection measure
(US) White House Official: Talks with China Economic Adviser Liu He were ‘frank and constructive’; US underscored the importance of achieving balance and reciprocity in the economic relationship with China.
Japan
Nikkei 225 opened -1.8%; closed -2.5%
TOPIX Iron & Steel index declines over 3% after US trade move
Japanese automakers decline after US announcement related to tariffs and gains in the Yen
Nikkei weighted Fast Retailing [9983.JP] declines over 2% ahead of Feb sales figures (reported Jan figures after the close)
(JP) Japan Jan Jobless Rate: 2.4% v 2.8%e (multi-decade low*)
(JP) Japan Feb Tokyo CPI Y/Y: 1.4% v 1.4%e; Ex-Fresh Food (Core) Y/Y: 0.9% v 0.8%e
(JP) Japan Feb Monetary Base Y/Y: 9.4% v 9.7% prior;
(JP) BoJ Gov Kuroda: Reiterates will consider further easing if needed and will adjust policy to reach target if needed.
(JP) Japan Fin Min Aso: Won’t comment on FX market; Carefully watching effect of labor shortage on economy, clear that there is a labor shortage in Japan
(JP) BoJ Gov Kuroda Upper House confirmation hearings set for March 6th; The confirmation hearings for the Dep Gov Nominees set for March 7th
Korea
Kospi opened -0.9%
(KR) South Korea Feb Nikkei PMI Manufacturing: 50.3 v 50.7 prior
(KR) South Korea is expected to nominate new Bank of Korea (BoK) chief on Monday – South Korean Press
(KR) South Korea held meeting on possible impact of US steel tariff; plans to reach out to US officials regarding its tariff plan
(KR) South Korea Pres Moon reportedly plans to send special envoy to North Korea soon – South Korea press
Other Asia
(IN) India Steel Sec: No immediate impact of US trade curbs on imports; Trump Administration is ‘stretching’ security clause as a barrier for steel imports to the US.
(TH) Thailand Feb Nikkei PMI Manufacturing: 50.9 v 50.6 prior
(TH) Thailand Feb CPI M/M: -0.2% v -0.1%e; Y/Y 0.4%* v 0.7%e
(TW) Taiwan Premier: No need to ‘panic’ about inflation
North America
US equity markets closed broadly lower: Dow -1.9%, S&P500 -1.3%, Nasdaq -1.3%, Russell -0.3%
S&P500 Industrials -2%, Financials -1.7%, Tech -1.7%
(US) Pres Trump: US will institute tariffs next week; will impose 25% tariffs on steel and 10% on aluminum imports – comments at White House
(US) Fed Chair Powell: there’s no strong evidence of a decisive move higher in wages; Reiterates gradual rate hikes are expected to be the appropriate path – Senate testimony
(US) Fed’s Dudley (dove, FOMC voter): Four 25bps rate hikes would still be a gradual pace; Can’t be too aggressive about rate hikes because inflation is still below target
(US) PIMCO economist Rich Clarida likely front runner for Fed deputy role – press-(US) Former Fed Chair Greenspan: bond market unwind will ultimately bring us into state of stagflation; As real interest rates rise, it’s inevitable that the effect on equity prices is negative – CNBC
Park Hotels & Resorts [PK]: China HNA said to plan to sell entire 25% stake which may be worth $1.4B – US financial press
Looking Ahead: Canada Q4 GDP due for release
Europe
(EU) Reportedly ECB unlikely to signal any policy changes at March 8th meeting, but might discuss dropping easing bias language – press
(EU) Likelihood that ECB’s Weidmann will replace Draghi is said to be increasing; Reportedly Weidmann gaining support as Germany agrees to support Spain’s De Guindos as next ECB Vice President – press
(EU) EU’s Juncker: EU will "react firmly" to T rump administration tariffs; will bring forward countermeasures
(ES) Reportedly Puigdemont may drop his effort to return to Catalan Presidency – Spain press
(UK) Prime Min May: Brexit deal must give UK control of its borders, laws and money; deal must protect people’s jobs; Will set out ‘five tests’ for Brexit deal – preview of March 2nd speech
(UK) PM May spokesperson: held constructive talks with Tusk today; called EU Commission draft text unacceptable
Technicolor [TCH.FR]: InterDigital makes binding offer to acquire Technicolor’s patent licensing business for $150M in cash
Levels as of 01:00ET
Hang Seng -1.4%; Shanghai Composite -0.5%; Kospi -0.8%
Equity Futures: S&P500 -0.1%; Nasdaq100 +0.1%, Dax -0.2%; FTSE100 -0.2%
EUR 1.2259-1.2288 ; JPY 105.93-106.32; AUD 0.7749-0.7775 ;NZD 0.7247-0.7277
Feb Gold +1% at $1,318/oz; Feb Crude Oil flat at $60.98/brl; Mar Copper +0.4% at $3.138/lb
