General Trend:
- Asian equity markets trade generally higher following declines on Tuesday; Shanghai continues to lag
- Chinese telecom ZTE rises over 10% (first gain in 5 sessions)
- Australia ASX 200 index outperforms and trades at highest level since early 2008; Financials and Utilities gain
- Australian telecom Telstra declines over 5%, announced job cuts and FY19 targets
- Philippines Central Bank expected to raise rates later today for the 2nd straight meeting; Thailand expected to leave rates unchanged
- New Zealand Q1 GDP figures due for release on Thursday, Debt agency to sell April 2037 bonds
Headlines/Economic Data
Japan
- Nikkei 225 opened +0.3%
- TOPIX Info & Communications index +0.4%, Securities +0.1%; Marine Transportation -1.9%, Iron & Steel -1.9%
- Japanese megabanks trade generally lower
- (JP) Japan FSA expected to take administrative action this week on some registered cryptocurrency exchange operators in Japan, including industry leader bitFlyer Inc – Japan press
- (JP) Bank of Japan (BoJ) April 26-27th Policy Meeting Minutes (2 meetings ago): Many agreed as there was still a long way to go to achieve the price stability target of 2%, it was necessary to maintain the current highly accommodative financial conditions
- (JP) Japan to extend current Diet session to July 22nd from today (as speculated)
Korea
- Kospi opened +0.4%
- SK Telecom, 017670.KR Separates 11Street from SK Planet in a move to catch up with Amazon – Korean press
- (KR) North Korea KCNA: Leader Kim Jong Un and China’s Xi exchanged opinions; had understanding on issues including denuclearization of the Korean peninsula
- (US) Commerce Dept imposes trade duties on polyester staple fiber from South Korea and Taiwan
- (KR) South Korea crypto currency exchange Bitthumb has been hacked; KRW35B in crypto currency said to have been stolen – South Korean Press
- (KR) South Korea Foreign Min Kang: Sanctions on North Korea to remain until completely denuclearized
- (KR) South Korea Fin Min Kim: To review ruling party request for expansionary fiscal policy – Korean press
China/Hong Kong
- Hang Seng opened 0.0%, Shanghai Composite -0.6%
- Hang Seng Consumer Goods index +1%, Services +0.9%, Info Tech +0.8%, Energy +0.7%; Materials -1.3%
- (CN) China PBOC Gov Yi Gang: Investors should stay calm; confident of capital market development; financial liquidity reasonable, stable (after the close)
- (CN) China Securities Journal: No basis for continuous plunge in A-shares
- (CN) China PBoC Open Market Operation (OMO): Injects CNY100B in 7 and 14 day reverse repos v CNY100B injected in 7, 14 and 28-day reverse repos prior: Net: CNY40B injection v CNY50B injected prior
- (CN) China PBoC sets yuan reference rate at 6.4586 v 6.4235 prior
- (CN) China Banking and Insurance Regulatory Commission (CBIRC): banking and insurance sectors have been performing on solid footing, with risks under control – Xinhua
- 763.HK ZTE: US Commerce Dept official: still working out escrow agreement necessary to lift ZTE ban; it’s part of a normal process
Australia/New Zealand
- ASX 200 opened +0.3%
- ASX 200 Financials index +1.8%, REIT +0.9%, Utilities +0.9%, Energy +0.9%; Telecom -4.2%
- Telstra,[-5%], TLS.AU Announces restructuring: To layoff 8.0K employees and contractors; Guides FY19 EBITDA A$8.7-9.6B ex ~A$600M in restructuring costs
- (NZ) New Zealand Q2 Westpac Consumer Confidence: 108.6 v 111.2 prior
- (NZ) New Zealand Q1 BoP Current Account Balance (NZ$): 180M v 50Me; Current Account to GDP Ratio: -2.8% v -2.8%e
- (AU) Australia sells A$700M v A$700M indicated in 2.25% Nov 2022 bonds, avg yield 2.2716% v 2.4172% prior, bid to cover 4.03x v 7.11x prior
- (AU) Australia May Westpac Leading Index m/m: -0.2% v +0.2% prior
- (AU) Australia govt crackdown on foreign property sales seen as a failure; only finding 4.3K not in compliance since 2015 – AFR
Other Asia
- Noble Group, [+50%], NOBL.SG Issues update on financial restructuring plan: Shareholder Goldilocks agreed to discontinue all claims and proceedings on a no-fault basis
- (MY) Malaysia May CPI Y/Y: 1.8% v 1.8%e (3rd straight month of annual pace below target)
North America
- US equity markets ended mostly lower: Dow -1.2%, S&P500 -0.4%, Nasdaq -0.3%, Russell 2000 +0.1%
- S&P500 Industrials -2.1%, Materials -1.8%
- WBA To replace GE in Dow Jones Industrial Average, effective June 26th
- SBUX Cuts FY18 adj EPS $2.39-2.43 v $2.49e (prior $2.48-2.53); Raises Quarterly dividend 20% to $0.36 from $0.30 (indicated yield 2.51%) – Oppenheimer conf comments
- BTC/USD Coinbase CEO: Price dip in bitcoin can be attributed to people being irrationally pessimistic; sees downturns as the perfect time to make progress as a company “while everyone else gets distracted.” – press citing talk to new employees
- (US) Weekly API Oil Inventories: Crude: -3M v +0.8M prior
- (US) SEMI: May North America Billings $2.70B (3-month avg basis), +0.6% m/m and +19.2% y/y
Europe
- (EU) ECB’s Lane (Ireland): need to see sizable inflation shock to reverse decision to end QE
- (IR) Iran Oil Min Zanganeh: does not think there will be agreement at this OPEC meeting; Iran will not accept even a modest increase in output – comments in Vienna
Levels as of 01:30ET
- Hang Seng +1.3%; Shanghai Composite +0.2%; Kospi +1.3%; Nikkei 225 +1.1%; ASX 200 +1.0%
- Equity Futures: S&P500 +0.3%; Nasdaq100 -0.1%, Dax +0.2%; FTSE100 +0.4%
- EUR 1.1567-1.1596; JPY 109.55-110.57; AUD 0.7369-0.7405;NZD 0.6890-0.6917
- Aug Gold -0.2% at $1,276/oz; Aug Crude Oil -0.7% at $65.25/brl; Jul Copper +0.5% at $3.05/lb
