Asian Equity Markets Trade Mixed, In Line With Tuesday’s US Session

Mar 06 19, 07:35 GMT

General Trend:

Telecom service, IT and Materials firms outperform in early trading in China; property and financial shares lag
Financial and Machinery companies trade lower in Japan, Fast Retailing drops over 2%
Japan consumer name Sanrio rises over 11% amid speculation related to ‘Hello Kitty’ film
Taiwanese DRAM maker Nanya speculated to cut Q1 shipments target (local press)
Resources and Energy shares rise in Australia
Bubs Australia (infant milk formula company) rises over 20% on jv in China
Aussie dept. store Myer rises over 9%, swung to H1 profit
Australian dollar (AUD) and bond yields decline on weaker GDP data
BoJ raised daily purchase amounts for 5-10 yr JGB operation (as signaled)
BoJ dissenter Harada said sales tax hike may cause recession, weaken CPI
Philippine Peso (PHP) extends decline after recent CPI data, RRR cut speculation
Australia Jan retail sales and trade data due on Thursday

Headlines/Economic Data

Japan

Nikkei 225 opened -0.3%
(JP) Bank of Japan (BOJ) Board Member Harada (dissenter): Underlying weakness in flation could weigh on inflation expectations, delay acceleration of inflation; BOJ must strengthen easing without hesitation if economy worsens, makes it hard to hit price goal
7013.JP Reportedly IHI has halted engine maintenance inspections at Toyko plant after allegations that it assigned unqualified workers to check aircraft engines – press
(JP) Japan Finance Ministry (MOF) Currency Head Asakawa: The link between the yen and Japan’s exports has been “severed” – press
(JP) Bank of Japan (BOJ) announcement related to daily bond buying operation: raises 5-10-yr bond buying amount
(JP) Japan PM Abe: Reiterates stance want to raise sales tax unless there is another Lehman size event

Korea

Kospi opens -0.1%
(KR) South Korea Feb Foreign Reserves: $404.7B v $405.5B prior (1st decline in 4-months)
(KR) According to South Korea National Intelligence Service North Korea was taken aback by the sudden end to summit with Trump, it will take quite a while for them to review what happened to the summit – Korean press citing briefing to SK Govt
(KR) US declines to comment if its been in contract with North Korea since the summit ended – Yonhap
(KR) US National Sec Adviser Bolton: Will consider increasing sanctions on North Korea if no progress is made, North Korea has to reassess its strategy
(KR) South Korea and the US said to be in talks regarding extension to oil waiver related to Iran – Local press

China/Hong Kong

Hang Seng opens +0.1%; Shanghai Composite opens +0.2%
Han’s Laser [002008.CN]: Hong Kong Exchange halted buy orders related to the company from foreign investors under the Shenzhen-Hong Kong Stock Connect program, offshore ownership of the company has approached the 30% cap
(CN) China PBoC sets Yuan Reference Rate: 6. 7053 v 6.6998 prior
(CN) China PBOC Open Market Operation (OMO): Skips OMO v skipped prior (5th consecutive skip); Net: CNY60B drain v CNY120B prior
(CN) China President Xi may visit North Korea this month – Korean press
(CN) China NDRC Chairman He Lifeng: China still has stable and improving outlook in 2019; to further reduce negative list for foreign investors this year, including agriculture, mining and service
(CN) China Tangshan (top steel making city) extends curbs related to steel sintering until further notice , cites air pollution

Australia/New Zealand

ASX 200 opened +0.1%
(AU) AUSTRALIA Q4 GDP Q/Q: 0.2% V 0.3%E (weakest reading since 2016); Y/Y: 2.3% V 2.6%E
(AU) ‘Australian economy in a recession of sorts’, notes per-capital GDP declined in both Q3 and Q4 – US financial press article
(AU) Australia Treasurer Frydenberg: Economy is fundamentally in good shape; to deliver budget surplus in April
(AU) Reserve Bank of Australia (RBA) Gov Lowe: Current adjustment in housing markets is unusual, was not preceded by mortgage rates rising; Wealth effects influencing consumption but mainly through expectations – speaking at Australian Financial Review’s 2019 Business Summit
(AU) RBA Gov Lowe: Hard to think of a scenario where rates would rise this year; unlikely inflation going to be problem any time soon, no case to adjust inflation target; Q4 and Q3 GDP likely to show growth significantly below trend – Q&A
MYR.AU Reports H1 (A$) Net +38.4M v -476M y/y, EBITDA 113.6M v 108.3M y/y; Rev 1.67B v 1.72B y/y
BUB.AU Enters into MOU with Beingmate China to form JV
(AU) JPMorgan now expects the RBA to cut rates in July and Aug 2019, notes growth unlikely to be enough to lower jobless rate – US financial press

Other Asia

(PH) Philippine newly named Central Bank Gov Diokno: have to be more circumspect when it comes to the Peso; does not look at daily FX moves, looks at ‘other factors’; premature to cut rates must be evidence based
(PH) Philippines Finance Min Dominguez: Keeping 7-8% GDP target

North America

(US) Weekly API Oil Inventories: Crude: +7.3M v -4.2M; Distillate: -3.1M v +0.4M prior
JNJ FDA approves Spravato (esketamine) nasal spray, in conjunction with an oral antidepressant, for the treatment of depression in adults who have tried other antidepressant medicines but have not benefited from them (treatment-resistant depression)

Europe

(UK) Cabinet reportedly told by Chief Whip that Brexit vote will be tight – press
(UK) EU and UK Brexit negotiators end talks in Brussels with no agreement (as expected); talks to continue tomorrow – press
(UK) Chief Whip: A soft Brexit could happen if PM May’s deal is rejected again – press
(US) US Fed said to consider more strict rules related to foreign bank branches – financial press
LOGN.CH Affirms FY19 Op profit $340-345M; Rev +9-11% y/y at cc; Guides initial FY20 Op +10-12% from mid point of FY19; Rev mid high single digit increase at cc

Levels as of 12:50ET

Hang Seng +0.3%; Shanghai Composite +0.9%; Kospi -0.2%; Nikkei225 -0.6%; ASX 200 +0.8%
Equity Futures: S&P500 -0.2%; Nasdaq100 -0.2%, Dax -0.2%; FTSE100 +0.1%
EUR 1.1290-1.1319; JPY 111.73-111.92; AUD 0.7029-0.7093; NZD 0.6754-0.6802
Commodity Futures: Gold +0.3% at $1,287/oz; Crude Oil -0.9% at $56.05/brl; Copper -0.3% at $2.93/lb