General Trend:
- World Health Organization (WHO) delayed decision on whether to declare the coronavirus outbreak an international emergency, to meet again on Thursday
- Gaming and airline companies trade lower in Hong Kong, Macau reported 2nd case of the coronavirus
- China Unicom drops over 3% amid FY guidance
- Property, telecom services and consumer discretionary firms are among the decliners in Shanghai
- Decliners in Australia include Energy, Consumer Staples and Resource companies
- Downer [construction services co.] declines over 20% in Australia on lower outlook, increased the costs related to certain projects and reduced forecast construction revenue
- Aussie construction services firm CIMIC Group drops over 19%, BIC Contracting [co. affiliate] is holding talks with lenders
- National Storage REIT rises over 7% in Australia on takeover talks
- Sectors moving lower in Japan include the trade sensitive Marine/Transportation index; Nidec is expected to report its earnings later today
- Probability of Feb 2020 RBA rate cut declines sharply after better Dec jobs data, some bank analysts revise easing expectations
- Fitch raised New Zealand’s foreign currency rating outlook to Positive
- PBOC to conduct targeted MLF operation ahead of Lunar New Year break (as speculated), but rate will be kept unchanged
- PBOC Adviser commented on financing costs and inflation pressure
- China upwardly revises its Dec USD-denominated trade data
- China Commerce Ministry (MOFCOM) sometimes holds its weekly press conferences on Thursdays (comments generally seen during the early European morning)
- ECB and Indonesia Central Bank are due to hold policy meetings later today
- Companies expected to report results during the NY morning include Comcast, Freeport-McMoran, Jetblue, Southwest, Kimberly-Clark, Procter & Gamble, Travelers, Union Pacific and VF Corp
- Lunar New Year Holiday Schedule: China markets to be closed Jan 24-30th for Lunar New Year holiday, Hong Kong markets to be closed Jan 27-28th for Lunar New Year Holiday
Headlines/Economic Data
Australia/New Zealand
- ASX 200 opened -0.2%
- (AU) AUSTRALIA DEC EMPLOYMENT CHANGE: +28.9K V +10.0KE; UNEMPLOYMENT RATE: 5.1% V 5.2%E
- DOW.AU Cuts FY20 (A$) Net 300M (prior 365M); to provide A$10M for one off restructuring costs to reflect net impact of staff redundancies
- WBC.AU Appoints John McFarlane Chairman, effective April 2nd; will be in charge of appoint a permanent CEO
- (AU) AUSTRALIA JAN CONSUMER INFLATION EXPECTATION SURVEY: 4.7% V 4.0% PRIOR (multi-year high)
- (NZ) New Zealand sells NZ$150M v NZ$150M indicated in 2.75% 2037 bonds; avg yield 1.9229% v 1.7147% prior; bid to cover 2.98x v 3.13x prior
Japan
- Nikkei 225 opened -0.8%
- (JP) JAPAN DEC TRADE BALANCE: -¥152.5B V -¥152.6BE; ADJ TRADE BALANCE: -¥102.5B V -¥236.0BE
- (JP) Japan Cabinet Office (Govt) Monthly Economic Report for Jan: Maintains its overall economic assessment (after the close yesterday)
- 4755.JP Expands mobile service trial to 20K additional people, has over 3.0K base stations (ahead of plan)
Korea
- Kospi opened -0.6%
- (KR) US State Dept Official: Will continue “slow, patient, steady diplomacy” with North Korea – Yonhap
China/Hong Kong
- Hang Seng opened -0.8%; Shanghai Composite opened -0.7%
- (CN) China PBOC sets Yuan Reference Rate: 6.8876 v 6.8853 prior
- (CN) China PBoC Advisor: Will continue to lower financing costs and must prevent leverage ratio from rising; will also consider inflation pressure
- (CN) CHINA PBOC CONDUCTS CNY240.5B V CNY297.7B PRIOR 1-YEAR TARGETED MEDIUM-TERM LENDING FACILITY (TMLF) AT 3.15% V 3.15% PRIOR (4TH TIME USING)
- (CN) China PBoC Open Market Operation (OMO): Skips v injects CNY30B in 14-day prior; Skips v injects CNY30B prior
- (CN) Wuhan bus, metro, ferry and passenger service have suspended operations from Jan 23rd to address China coronavirus outbreak; recovery time will be announced separately – China state media
- (CN) China local doctors in Wuhan estimate number of cases may be as high as 6000; Wuhan Municipal Health Commission said to have prepared at least 5,600 beds in hospitals across the city to receive coronavirus patients – China Press
- (HK) Macau cancels all Lunar New year festivities (due to coronavirus)
- (CN) China Dec Swift Global Payments CNY: 1.94% v 1.93% prior
Other Asia
- (PH) Philippines Q4 GDP Q/Q: 2.2% v 2.0%e; Y/Y: 6.4% v 6.4%e; 2019 GDP: 5.9% v 5.9%e (slowest growth in 8-years)
- (PH) Philippines Central Bank Gov Diokno: 7.0% GDP is attainable in 2020
North America
- TER Reports Q4 $0.88 v $0.79e, Rev $655M v $615Me; raises dividend 11% to $0.10 (implied yield 0.5%), to buyback $1.0B in shares (8.1% of market cap)
- (US) Weekly API Crude Oil Inventories: 1.6M v +1.1M prior
- BA CEO: Expects 737 MAX production will resume months before return to service in midyear; no discussions about cutting dividend
Europe
- (UK) PM Johnson’s Brexit agreement passes through UK Parliament; now moves to queen for royal assent
- (FR) France Fin Min Le Maire: Hope for a compromise on digital tax with US soon
Levels as of 12:15ET
- Hang Seng -2.1%; Shanghai Composite -2.5%; Kospi -1.1%; Nikkei225 -1.0%; ASX 200 -0.6%
- Equity Futures: S&P500 -0.2%; Nasdaq100 -0.2%, Dax -0.1%; FTSE100 -0.1%
- EUR 1.1099-1.1080; JPY 109.86-109.56; AUD 0.6879-0.6838; NZD 0.6601-0.6585
- Commodity Futures: Gold +0.1% at $1,558/oz; Crude Oil -1.7% at $55.75/brl; Copper -0.5% at $2.76/lb
