Equities Trade Mixed In First Session of 2020

Jan 02 20, 06:25 GMT

General Trend:

Small-cap, property and financial firms gain in Shanghai on PBOC RRR cut announcement
Large steel maker Baoshan rises as China’s largest steelmaking city issued pollution alert
Chinese liquor giant Kweichow Moutai drops over 3% on weaker than expected FY earnings, sees slower revenue growth in 2020
Financials and property firms in Hong Kong track the gains being seen in Shanghai
HK gaming stocks outperform on better than expected Dec gaming revenues
Gainers in Australia include Telecom Services and Consumer companies
South Korea’s Kospi underperforms; Decliners include financials and automakers, along with Samsung Electronics
Japanese markets are closed today and tomorrow

Headlines/Economic Data

Australia/New Zealand

ASX 200 opened 0.0%
(AU) Australia Dec Final CBA PMI Manufacturing: 49.2 v 49.4 prelim (lowest reading since series started)

Japan

Korea

Kospi opens +0.2%
(KR) South Korea Dec Trade Balance $2.0B v $3.5Be; Exports Y/Y: -5.2% v -8.6%e (13th consecutive decline, smallest decline since April); Imports Y/Y: -0.7% v -6.9%e; Semiconductor exports Y/Y: -17.7% v -32.1% prior; Exports to China Y/Y: +3.3% v -16.9% prior (first rise in over 1 year)
005380.KR Hyundai Motor Group said to plan to increase annual investment to KRW20T – US financial press
(KR) North Korea Leader Kim: US will ‘suffer helplessly’ if it continues to delay; World will witness new strategic weapon – South Korean press (yesterday)
(KR) South Korea Dec PMI Manufacturing: 50.1 v 49.4 prior (highest since Apr 2019)
(KR) Bank of Korea (BOK) Gov Lee: May not replace all 4 board members when their term ends at end of April; CPI and GDP to improve in 2020, but don’t expect a drastic recovery; still have room with interest rates

China/Hong Kong

Hang Seng opened +0.2%; Shanghai Composite opened +0.5%
(CN) China PBOC cuts Reserve Requirement Ratio (RRR) by 50bps, effective Jan 6 2020; RRR cut aimed at supporting economy; The RRR cut is said to release ~CNY800B in liquidity
(CN) China PBOC: Monetary policy should be flexible to maintain liquidity; will comprehensively use multiple monetary tools; Will keep yuan exchange rate balanced and stable (yesterday)
(CN) CHINA DEC CAIXIN PMI MANUFACTURING: 51.5 V 51.6E (5th consecutive month of expansion)
(HK) Macau Dec Gaming Rev (MOP) 22.8B v 22.9B prior; Y/Y: -13.7% v -8.5% prior; 2019 Macau Casino Rev (MOP) 292.5B, -3.4% y/y
600519.CN Reports Prelim FY19 (CNY) Net ~40.5B, +15% y/y; Rev 88.5B v 73.6B y/y
(CN) China PBOC sets Yuan Reference Rate: 6.9614 v 6.9762 prior (strongest fix since Aug 2019)
(CN) China PBoC Open Market Operation (OMO): Skips reverse repos for the 8th consecutive session; Net drain CNY400B v drain CNY0B prior
(CN) Ganzhou (China) has launched its rare earths exchange (2nd rare earth exchange in China) – Chinese press

Other Asia

(SG) SINGAPORE Q4 ADVANCED GDP Q/Q: 0.1% V 0.4%E; Y/Y: 0.8% V 0.8%E; 2019 GDP y/y: 0.7% v 0.6%e

North America

(US) More than 250 drugs in the US saw their prices rise, effective today; median increase is 5%, with all increases below 10%
(US) US Treasury Sec Mnuchin is expected to lead the US’ Davos delegation; President Trump will also attend – US financial press
(US) President Trump: China deal likely to be signed January 15th, we will be starting phase 2 talks soon and they could complete negotiations

Europe

AIR.FR Reportedly exceeds own goal with 863 jet deliveries in 2019, +8% y/y – press
(AT) As expected Austria conservative leader Sebastian Kurz reached deal with Greens on coalition Govt ; Kurz will be chancellor and Green’s Kogler will become Austria’s vice-chancellor

Levels as of 12:15ET

Hang Seng +0.8%; Shanghai Composite +1.2%; Kospi -0.9%; Nikkei225 closed; ASX 200 +0.2%
Equity Futures: S&P500 +0.3%; Nasdaq100 +0.4%, Dax +0.7%; FTSE100 +0.3%
EUR 1.1225-1.1200; JPY 108.77-108.61; AUD 0.7020-0.6999; NZD 0.6739-0.6717
Commodity Futures: Gold -0.1% at $1,522/oz; Crude Oil +0.3% at $61.22/brl; Copper +0.8% at $2.82/lb