Headlines/Economic Data

General Trend:

  • Asian equity indices trade generally higher, in line with Tuesday’s US session
  • Energy producers track outperformance in S&P500 Energy index
  • Chinese automaker Geely reports mixed FY17 results
  • Tencent rises ahead of earnings report (due after market close)
  • G20 releases final communique amid lingering trade tensions
  • Fitch affirms China’s sovereign rating but notes risks related to trade
  • Aussie (AUD) and Kiwi (NZD) in focus ahead of Thursday’s Australia employment data and RBNZ rate decision
  • Australian short interest rates rise ahead of Wednesday’s Fed decision and forecasts
  • Canadian Dollar (CAD) and Mexican Peso (MXN) rise amid NAFTA speculation
  • Various US companies price secondary offerings ahead of Fed meeting

Australia/New Zealand

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  • ASX 200 opened +0.3%; closed +0.2%
  • ASX 200 Energy Index +1.2%, Resources +0.7%, Financials +0.6%; Utilities -0.9%, Telecom -0.7%, REIT -0.6%
  • Nufarm [NUF.AU] rose over 5% after reporting H1 results and issuing guidance.
  • (AU) Australia sells A$1.0B v A$1.0B indicated in 2.25% Nov 21 2022 Bonds, avg yield 2.3449% v 2.3582% prior, bid to cover 3.94x v 4.10x prior
  • (NZ) New Zealand Feb Credit Card Spending M/M: +0.7% v -0.6% prior; Y/Y: 7.0% v 4.6% prior

China/Hong Kong

  • Shanghai Composite opened +0.3%, Hang Seng +0.9%
  • Hang Seng Energy Index +2.5%, Property/Construction +2.3%, Info Tech +1.4%, Financials +0.8%
  • Shanghai Composite Property index rises over 1%
  • (CN) US Treasury Sec Mnuchin: I discussed with PBOC Chief Zhou the importance of bilateral economic relationship and fair and reciprocal trade
  • (CN) China Vice Commerce Min: China will actively take measures to safeguard domestic industries’ interests in response to US trade investigations
  • (CN) Fitch affirms China sovereign rating at A+; Trade tensions with the US have clearly risen, posing downside risk to Fitch’s baseline outlook
  • (CN) PBoC Gov Zhou: China’s economy better than expected – G20 Central Bank Gov Meeting
  • (CN) PBoC sets yuan reference rate at 6.3396 v 6.3246 prior
  • (CN) China PBoC Open Market Operation (OMO): Skips OMO (second straight session) v skipped prior; Net: drain CNY40B v CNY40B drain prior

Japan

  • Nikkei 225 closed for holiday
  • (JP) BoJ Gov Kuroda: Fed or any other central bank would undoubtedly normalize if their economies are in good shape and they achieve price targets; Does not believe normalization will have a direct negative effect on global growth; Normalization concern was not a key topic at G-20
  • (JP) Japan LDP Policy Chief Kishida: Japan needs exit strategy from ‘easy money’, reiterates relaxed monetary policy needs to remain for now

Korea

  • Kospi opened +0.1%
  • SK Innovation [096770.KR] to acquire shale assets in the US
  • (KR) Bank of Korea Gov Lee: Reiterates need to keep policy interest rate accommodative as inflationary pressure is not strong from demand side; Declines comment on timing of next rate hike – Parliamentary Hearing
  • (KR) South Korea March 1-20 Exports Y/Y: 9.3%; Imports Y/Y: 5.8%
  • (KR) South Korea President Moon said to note summit between South Korea/North Korea/US is possible – South Korea Press

North America

  • US equity markets ended mostly higher: Dow +0.5%, S&P500 +0.2%, Nasdaq +0.3%, Russell 2000 flat
  • S&P500 Energy +0.9%; Utilities -0.5%
  • FedEx [FDX]: Reports Q3 $3.79 v $3.09e, Rev $16.5B v $16.2Be; Raises Adj FY18 $15.00-15.40 v $13.51e (prior $12.70-13.30)
  • Nordstrom [JWN] declines over 2% in the after hours: Board’s special committee terminated talks with Nordstrom Family after the parties were unable to agree on price.
  • (US) US government said to drop demand on Canada and Mexico autos in NAFTA talks – Canadian Press
  • (US) Airlines including Delta and American said to cancel flights ahead of expected storm in the Northeast
  • (US) Weekly API Oil Inventories: Crude: -2.7M v +1.2M prior

Europe

  • G20 draft communique: recognize need for further dialogue and actions on trade issues; Leaders to stand by language from last year’s Hamburg statement (which said members “recognize the role of legitimate trade defense instruments”)
  • G20 releases final communique: Confirms leaders recognize need for further dialogue and action on trade
  • (EU) Germany Fin Min Scholz: biggest worry at G20 meeting was potential trade war with US
  • (EU) ECB’s Visco (Italy): G20 agrees that trade wars are negative sum games; haven’t heard any voices at the G20 against multilateralism
  • (UK) EU chief Brexit negotiator Barnier: We have a clear UK commitment on the Ireland border; The Ireland backstop solution will be included in the Brexit treaty
  • Ubisoft [UBI.FR]: Vivendi agrees to sell its 27.3% interest in Ubisoft to Tencent and Ontario Teachers for €2B; Ubisoft signs strategic partnership with Tencent to promote games in China

Levels as of 01:00ET

  • Hang Seng +1.1%; Shanghai Composite +0.5%; Kospi +0.1%
  • Equity Futures: S&P500 +0.1%; Nasdaq100 flat, Dax +0.1%; FTSE100 flat
  • EUR 1.2240-1.2267 ; JPY 106.43-106.56; AUD 0.7680-0.7704 ;NZD 0.7168-0.7189
  • Feb Gold +0.1% at $1,313/oz; Feb Crude Oil +0.2% at $63.66/brl; Mar Copper +0.1% at $3.041/lb
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