High Level Talks Between US And N. Korea Disclosed

Apr 18 18, 07:35 GMT

General Trend:

Another mixed trading session for Asia, despite US gains
Nikkei outperforms as Trump and Abe meet; Fast Retailing and Softbank rise
Australia’s Rio Tinto rises over 1%; affirmed iron ore shipment forecast, to revise aluminum guidance
Asian chipmakers track US gains; Nanya Technology said to see DRAM supply constraints until Q3
Shanghai Composite has swung between gains and losses, despite targeted RRR cut by PBoC; Banks gain, while automakers underperform
China govt said to allow foreign auto companies to set up more than two ventures
Large bad bank China Huarong Asset Management placed on trading halt amid government probe
Chinese bond yields decline after PBoC RRR cut
Hong Kong 3-month money market rate rises amid continued currency interventions by the HKMA
China March new home prices rise at slowest pace since 2016
Japan March Trade surplus above ests, imports have first decline since 2016; Exports to the US slow
AUD/NZD in focus as New Zealand Q1 CPI and Australia March Employment data due for release on Thursday
Taiwan Semi expected to report earnings tomorrow

Headlines/Economic Data

Japan

Nikkei 225 opened +0.4%; closed +1.4%
TOPIX Real Estate index +2%, Information/Communications +1.7%, Electrical Appliances +1.4%, Retail Trade +1.3%, Securities +0.9%, Iron & Steel +0.7%
(JP) Opposition party members call for resignation of Japan Finance Min Aso amid political scandals – Japanese Press
(JP) JAPAN MAR TRADE BALANCE: ¥797.3B V ¥449BE; ADJ TRADE BALANCE: ¥119.2B V ¥104BE
(CN) China and Japan to cooperate in relation to services, technology innovation and tourism sectors
Suruga Bank, [-16%], 8358.JP Japanese Press reports the firm said to have given out loans based on false documents

Korea

Kospi opened +0.6%
(KR) IMF affirms South Korea 2018 GDP outlook of 3%, 2019 at 2.9%
(US) President Trump: Have been speaking directly with North Korea leader Kim
(US) The then US CIA Director Pompeo said to have met with North Korea leader Kim during visit to North Korea over Easter – Washington Post
(KR) Bank of Korea (BOK) sells KRW2.9T in 2-yr Monetary Stabilization Bonds (MSB) at 2.105%
Posco, 005490.KR CEO Kwon said to offer to resign early, he said company needs a new, young leader, but he will remain CEO until a replacement is found – South Korean press
(KR) South Korea Q1 long term unemployment reaches 18-yr high – Korean press

China/Hong Kong

Hang Seng opened +0.1%, Shanghai Composite +0.8%
Hang Seng Energy index +1.3%, Financials +0.7%, Services +0.7%, Property/Construction +0.4% ; Consumer Goods -1.5%, Industrial goods -0.9%
Shanghai Property sub-index trades flat
(CN) CHINA PBOC CUTS RESERVE RESERVE RATIO (RRR) BY 100BPS FOR QUALIFIED BANKS (targeted cut); effective Apr 25th (after the close)
(HK) Hong Kong Monetary Authority (HKMA): buys HK$5.1B to defend currency peg
(CN) China bond yields move lower after PBoC RRR cut: 1-year swap rate declines over 10bps, China Development Bank 10-year yield declines over 15bps
(CN) China PBoC Open Market Operation (OMO): Injects CNY150B in 7-day reverse repos v skips prior; Net: injects CNY150B
(CN) China PBoC sets yuan reference rate at 6.2817 v 6.2771 prior
(CN) China Feb Avg New Home Prices M/M: 0.4% v +0.3% prior; Y/Y: 4.9% v 5.2% prior
(CN) China NDRC: Expects 2018 consumer price inflation to be mild, producer price inflation to ease
China Huarong Asset Management, 2799.HK Chairman being investigated by Central Commission for Discipline Inspection (CCDI) for possible serious disciplinary violations, no further details given

Australia/New Zealand

ASX 200 opened +0.1%
ASX 200 Consumer Discretionary index +1.6%, Energy +1.4%, Resources +1.2%, REIT +0.9%; Telecom -0.8%, Financials -0.2%
Rio Tinto, RIO.AU Reports Q1 Pilbara iron ore shipments 80.3Mt v 80.5Mte; Pilbara iron production 83.1Mt v 77.2Mt y/y
Woodside Petroleum, WPL.AU Reports Q1 Rev $1.17B v $902.4M y/y; Production 22.2MMBOE v 21.4 y/y
(AU) Australia Mar Westpac Leading Index m/m: -0.2% v 0.4% prior
(AU) Australia sells A$600M v A$600M indicated in 3.00% March 2047 bonds, avg yield 3.3628% v 3.4359% prior, bid to cover 3.0x v 2.53x prior
(AU) Australia Mar Skilled Vacancies m/m: 0.9% v 1.2% prior

North America

US equities end higher: Dow +0.9%, S&P500 +1.1%, Nasdaq +1.7%, Russell 2000 +1.1%
S&P500 Technology +1.9%, Consumer Discretionary +1.9%
VMware [VMW]: Carl Icahn said to acquire less than 5% stake – US financial media
LUV Follow Up: NTSB Chairman: The company to perform additional inspections on fleet
IBM [IBM] declines over 5% in the afterhours amid FY18 earnings guidance
(US) Fed’s Bostic (FOMC voter, dove): Businesses are confused by direction of US trade policy; hearing about labor shortages everywhere
(US) Fed’s Williams (moderate, voter): sees US economy continuing to improve; A reassessment of low 10-year yields poses risks
During Asian session, US 2-year Treasury yield hit 2.4000% (highest since Sept 2008)
(US) Weekly API Oil Inventories: Crude: -1M v +1.8M prior
Looking Ahead: Bank of Canada rate decision expected later today

Europe

(DE) German Chancellor Merkel wants to strengthen role of economic ministers in EU – German press
Looking Ahead: UK March CPI data due later today

Levels as of 02:00ET

Hang Seng +0.9%; Shanghai Composite +0.7%; Kospi +0.9%; ASX 200 +0.3%
Equity Futures: S&P500 +0.3%; Nasdaq100 +0.3%, Dax +0.3%; FTSE100 +0.1%
EUR 1.2382-1.2365; JPY 107.38-107.00; AUD 0.7773-0.7759;NZD 0.7344-0.7328
Jun Gold -0.3% at $1,345/oz; May Crude Oil +0.9% at $67.11/brl; May Copper +0.2% at $3.09/lb