Rates And Oil Prices Also Remain In Focus

General Trend:

• Energy companies outperform, Financials trade generally lower
• Airlines generally weighed down by rise in oil prices
• Canadian Dollar and Mexican Peso decline as US Trade official continued to make cautious comments on possibility of near-term NAFTA agreement
• Reportedly China trade delegation offers package to reduce US trade deficit by $200B annually, said a press report; yet to be confirmed by US or China officials
• China to end dumping probe related to US Sorghum; US Corn, Wheat and Soybean Futures rise
• US/China talks to continue on Friday
• Japan CPI slows for 2nd straight month
• US Treasury yields extend gains during Asian session; Asian 10-yr yields move generally higher
• Australia 3-month bank bill rate rises for second straight session
• China sold 50-year bonds at a lower than expected yield
• China local government firm in Inner Mongolia said to fail to pay interest and principal on approx. CNY4.0B in loans – Chinese Press
• Indonesia Rupiah (IDR) declines after rate hike
• Indonesia Central Bank: “Is in the market” to smoothen Rupiah currency (IDR) volatility

Headlines/Economic Data

Australia/New Zealand

• ASX 200 opened +0.3%; closed -0.1%
• ASX 200 Resources index -0.8%, Telecom -0.6%, Financials -0.5%, Utilities -0.5%; Energy +0.8%, REIT +0.8%

China/Hong Kong

• Shanghai Composite opened -0.1%, Hang Seng +0.3%
• Hang Seng Energy index +3.6%, Property/Construction +0.7%, Materials +0.7%, Info Tech +0.4%; Industrial Goods -0.5%, Telecom -0.4%, Financials -0.2%
• (CN) Reportedly China trade delegation offers package to reduce US trade deficit by $200B annually – press
• (CN) China Commerce Ministry (MOFCOM): to end dumping probe related to US Sorghum; cites ‘public interest’
• (US) US President Trump: Important to keep trade cooperation with China; Both countries should expand agricultural cooperation
• (CN) China Vice Premier Liu He comments after meeting with Trump: China willing to work with US on trade issue
• (CN) Taiyuan City in China said to tighten controls related to home purchases – US financial press
• (CN) Shanghai Stock Exchange said to scrutinize share-backed loans by controlling shareholders – financial press
• (CN) China PBoC Open Market Operation (OMO): Skips OMO v CNY50B injected in 7-day and 14-day reverse repos prior
• (CN) China PBoC sets yuan reference rate at 6.3763 v 6.3679 prior
• (CN) China Finance Ministry (MOF) sells 50-year bonds: avg yield 4.13% v 4.22%e; bid to cover 2.24x

Japan

• Nikkei 225 opened +0.3%; closed +0.4%
• TOPIX Marine Transportation index +1.4%; Real Estate -0.4%, Securities +0.3%, Iron & Steel -0.3%
• (JP) JAPAN APR NATIONAL CPI Y/Y: 0.6% V 0.7%E; CPI EX FRESH FOOD (CORE): 0.7% V 0.8%E (lowest core reading since Sept 2017)

Korea

• Kospi opened +0.5%
• (KR) North Korea state media: N Korea to makes more efforts to defuse military tensions

North America

• US equity markets ended mixed: Dow Jones -0.2%, S&P500 -0.1%, Nasdaq -0.2%, Russell 2000 +0.5%
• S&P500 Energy +1.5%; Real Estate -0.5%, Technology -0.5%
• (US) Pres Trump: doubts China trade talks will be successful
• (US) US Trade Rep Lightizer: NAFTA countries are no where near close to a deal; will continue to engage in negotiations

Europe

• (EU) EU reportedly brushes off Prime Min May’s idea for customs plan guarantees – press
• (UK) UK reportedly establishes government team to deal with post-Brexit borders – press
• (EU) ECB’s Nowotny (Austria): some other governing council members agree that ECB should not wait too long to normalize monetary policy
• (ECB) ECB Nominee Rehn said jury is still out on extent of slowdown – US financial press
• Saudi and UAE Oil Min joint statement: see ample supply of oil; have concerns about recent oil market volatility; Plan meeting with Russia Oil Min Novak next week
• Vivendi [VIV.FR]: Reports Q1 Rev €3.11B v €2.68B y/y

Levels as of 02:00ET

• Hang Seng +0.3%; Shanghai Composite +0.1%; Kospi +0.4%
• Equity Futures: S&P500 +0.2%; Nasdaq100 +0.3%, Dax +0.2%; FTSE100 flat
• EUR 1.1788-1.1809 ; JPY 110.71-111.02 ; AUD 0.7503-0.7520 ;NZD 0.6873-0.6897
• Jun Gold -0.1% at $1,288/oz; Jun Crude Oil +0.2% at $71.62/brl; Jul Copper +0.1% at $3.086/lb