Headlines/Economic Data
General Trend: Asian markets trade generally higher, despite mixed US equities session on Wednesday
US dollar generally weaker amid gains in Commodity and Asian currencies
Japan
Nikkei 225 opened -0.1%; closed -0.6%
TOPIX Iron/Steel Index +0.6%
Weakness in the financial sector: Mitsubishi UFJ -1.2%
Nintendo -0.5%: To delay rollout of larger Switch game cards until 2019 on technical issues , according to US financial press report
Nintendo: Said to target FY18 Switch sales of more than 20M units, said a Japanese press report [**Note: On Oct 30th, the company guided its current FY18 Switch unit sales at 14M (up from the prior forecast of 10M)]
Japan Nov Department Store Supermarket Sales y/y: 1.4% v 1.0%e
Japan Nov Retail Sales m/m: 1.9% v 0.7%e; Retail Trade y/y: 2.2% v 1.0%e
JAPAN NOV PRELIM INDUSTRIAL PRODUCTION M/M: 0.6% V 0.5%E; Y/Y: 3.7% V 3.6%E; Manufacturers see Dec production +3.4% m/m, Jan production
4.5% m/m; government raises assessment of industrial production
Japan Trade Ministry: The rise in industrial production was due to increased output of memory chips, semiconductor equipment and heavy machinery used for construction
BoJ releases summary of opinions of Dec meeting: When it is expected that economic activity and prices will continue to improve going forward, the situation may occur where the Bank will need to consider whether adjustments in the level of interest rates will be necessary
Japan Nov Vehicle Production y/y: 0.9% v 6.4% prior
Korea
Kospi opened +0.1%
Chipmakers add to gains seen on Wednesday’s session: Samsung +1.8%, Hynix +1%
Hyundai Motor -2.5%: South Korea Ministry of Land, Infrastructure and Transport orders the co and several foreign automakers to recall ~1M vehicles due to faulty parts – Korean press
Posco Steel -1.4% (tracked declines in US steelmakers)
Korean Won (KRW) +0.2% (continues to trade at more than 2-year highs; gaining for 4th straight session)
SOUTH KOREA JAN BUSINESS MANUFACTURING SURVEY: 82 V 82 PRIOR; NON-MANUFACTURING SURVEY: 78 V 80 PRIOR
South Korea Nov Cyclical Leading Index Change: -0.1 v -0.3 prior
South Korea Nov Industrial Production m/m: 0.2% v 1.3%e; y/y: -1.6% v 0.0%e; Revises Oct figures lower
South Korea Nov Retail Sales m/m: 5.6% v 1.3%e; y/y: 6.5% v 2.5%e
South Korea and the US to hold Free Trade Agreement (FTA) talks in Washington, D.C. on Jan 5th
Bank of Korea (BoK) annual monetary strategy for 2018: 2018 monetary policy to remain accommodative
South Korea and the US to hold first talks to amend Free Trade Agreement (FTA) in Washington, D.C. on Jan 5th
(KR) South Korea Financial Regulator (FSC) Vice Chairman: To make guidelines to prevent money laundering via cryptocurrency
Looking ahead: South Korea Dec CPI due for release on Friday
China/Hong Kong
Shanghai Composite opened -0.1%, Hang Seng +0.3%
Hang Seng Industrial Goods Index +1.2%, Information Tech +1%, Materials +1%, Financials +0.6%
Hang Seng Property Index +1%: China govt may keep tight control of the property market; Outbound investment to be more prudent – Chinese press
Shanghai Composite Consume Staples Index +1.5%: Liquor producer Kweichow Moutai +4.5% (guided FY17 profits +58% y/y, plans to raise prices by 18% on avg in 2018)
Geely +3.5% (announced agreement to become largest shareholder of Sweden’s Volvo AB)
Guangzhou Automobile Group: +2% (announced agreement to partner with EV maker NIO)
Herbal products company BaWang International Group +26% (declined ~31% on Wednesday): Said former CEO Wan is seeking to wind up Fortune Station and it sees no material impact to business
(CN) China 19th Central Committee to discuss changes to the constitution in January, sparking chatter Xi could have an extended term as President – Xinhua
(CN) Trump administration plans to unveil a series of trade penalties against China early next year in a move that some describe as “shock and awe” – financial press
(CN) Analysts expect China IPOs will increase in 2018 from MSCI’s decision to include A-shares in its indexes from June, a move expected to see a range of investors buy A-shares selected for inclusion
(CN) China Nov Swift Global Payments CNY: 1.75% v 1.46% prior
(CN) PBoC: Skips OMO operation for 5th straight session; Net drain CNY30B v CNY40B drain prior
USD/CNY (CN) China PBoC sets yuan reference rate at 6.5412 v 6.5421 prior
(CN) China to raise price of gasoline and diesel by CNY70/ton, effective Dec 29th
Australia/New Zealand
ASX 200 opened flat; closed +0.3%
ASX 200 Financials Index +0.2%; REIT -1.2%, Utilities -0.7%
DNA.AU Wins Injunction to close Star Paradise; +8%
Looking ahead: Australia Nov Housing and Private Sector Credit data due for release on Friday
Other Asia
(IN) India 10-year bond yield rises over 8 bps after government confirmed there might be additional borrowing in FY17/18
(TW) Taiwan’s Taiex gains as Apple suppliers rebound from losses seen earlier in week: Largan Precision +5.5%
(TW) Taiwan Dollar (TWD) hits more than 3-year high
Taiwan’s MediaTek: Sees 2018 to have a stable mobile phone market – Taiwan press
(TH) Thailand Nov Manufacturing Production Index ISIC NSA y/y: 4.2% v 1.8%e; Capacity Utilization: 64.16 v 60.45 prior
(TH) Thailand Nov Unemployment Rate: 1.1% v 1.3% prior
(SL) Sri Lanka Central Bank (CBSL) leaves Key Rates unchanged (as expected)
North America
US equity markets ended mixed: Dow +0.1%, S&P500 +0.1%, Nasdaq 0.0%, Russell 2000 0.0%
S&P 500 Utilities sector +0.4%; Energy -0.4%
(US) Fed’s Rosengren (hawk, non-voter in 2018): has concerns we may start to see a reach for yield
(US) White House said to consider Richard Clarida, Lawrence Lindsey for Fed Vice Chairman position; Former Pimco exec Mohamed El-Erian also in consideration – financial press
(US) TREASURY’S $34B 5-YEAR NOTE AUCTION DRAWS: 2.245%; BID-TO-COVER RATIO: 2.36 V 2.46 PRIOR AND 2.47 OVER THE LAST 12 AUCTIONS (highest yield since Apr 2010)
(US) Weekly API Oil Inventories: Crude: -6M v -5.2M prior
Looking Ahead: US Dec Chicago PMI data and weekly DOE Crude Inventories due for release on Thursday
Europe
(UK) EU officials indicate that UK Brexit minister may have been "sidelined"; EU negotiator Barnier has been dealing directly with another UK official – The Times
(BE) National Bank of Belgium maintains countercyclical capital buffer percentage at zero for Q1’18
(FR) FRANCE NOV NET CHANGE IN JOBSEEKERS: -29.5K V +8.0K PRIOR
M&A: Accor Hotels [AC.FR]: Reportedly in discussions with investors on potential AccorInvest stake sale – press
Levels as of 01:00ET
Nikkei225 -0.6%, Hang Seng +0.7%; Shanghai Composite +0.7%; ASX200 +0.3%, Kospi +0.9%
Equity Futures: S&P500 +0.0%; Nasdaq100 +0.1%, Dax +0.0%; FTSE100 +0.2%
EUR 1.1929-1.1886; JPY 113.35-112.88; AUD 0.7796-0.7765;NZD 0.7089-0.7054
Feb Gold +0.3% at $1,294/oz; Feb Crude Oil +0.2% at $59.77/brl; Mar Copper +0.4% at $3.29/lb
