Notes/Observations
- Risk aversion sentiment percolating as Trump officials said to weigh punishing China over coronavirus (including tariffs)
- Euro Area Apr Manufacturing PMI slump with France, Euro Zone, Italy at record lows; Germany and Spain at 10-year lows
Asia:
- Both China and Japan markets closed for Golden Week holidays (reopen mid-week)
- April PMI manufacturing data hits record lows in various Asian countries (Indonesia, Malaysia, Philippines)
- South Korea May CPI data missed expectations (MoM: -0.6% v -0.3%e; Y/Y: 0.1% v 0.4%e)
- China PBOC Gov Yi Gang stated that the domestic recovery from coronavirus pandemic was better than expected
Coronavirus:
- Total Global cases (vs Friday): at 3,506,924 (+7.7%); Total deaths: 247.5K (+6.0%)
Europe:
- UK PM Johnson expected to unveil a roadmap out of lockdown in an address to the nations on Sunday, May 10th. Believed that only a mass produced vaccine would defeat Coronavirus. England might allow primary schools to reopen on June 1st
- Spain PM Sanchez: To launch a €16B reconstruction fund
Americas:
- White House Press Sec McEnany stated that President Trump saw intelligence suggesting the coronavirus had its origins in a Wuhan lab
- US Sec of State Pompeo stated that there was significant amount of evidence of Covid-19 came from a lab in Wuhan
- President Trump stated that if China did not purchase US goods then he’ll end the trade deal
SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM
Equities
- Indices [Stoxx600 -3.38% at 328.52, FTSE -0.39% at 5,740.61, DAX -3.39% at 10,494.20, CAC-40 -4.04% at 4,387.31, IBEX-35 -3.01% at 6,714.00, FTSE MIB -3.07% at 17,147.50, SMI -2.26% at 9,411.98, S&P 500 Futures -1.09%]
- Market Focal Points/Key Themes: European indices open down across the board and stay under pressure as the session wore on; sectors leading to the downside include energy and industrials; better performers include healthcare; Gulf Marine rejects takeover proposal from Silverfox; Spanish PM announces €16B reconstruction fund; French FinMin expects lockdown to end next Monday; EC approves loan and guarantees for Air France; upcoming earnings expected in the US session include Ferrari, Tyson Foods, AIG and Endesa.
Equities
- Industrials: Thyssenkrupp [TKA.DE] -17% (funding issues)
- Technology: Dialog Semiconductor [DLG.DE] -6% (withdraws outlook)
- Telecom: Telefonica [TEF.ES] +3% (considering merging O2 and Virgin Media; said to cut Rev guidance)
Speakers
- ECB Survey of Professional Forecasters (SPF) cut the inflation outlook for the horizon period. Cut 2020 GDP growth forecast from +1.1% to -5.5% while raises 2021 GDP growth from 1.2% to 4.3% and raising 2022 GDP growth from 1.4% to 1.7%
- ECB’s De Guindos (Spain): Current level of uncertainty was high and reiterated that would do all that is necessary to avoid tensions
- France Fin Min Le Maire: Must be prepared to end lockdown measures on Monday, May 11th
- Japan PM Abe confirmed that he would extend Nationwide State of Emergency until May 31st (as speculated)
- Japan Tokyo prefecture said to ask businesses to remain close until end of May
- Singapore Health Min stated that could reopen economy if community cases were at zero for a period
Currencies/Fixed Income
- Risk aversion flow helped the USD firm up against the major European pairs. Risk aversion sentiment percolating as Trump officials said to weigh punishing China over coronavirus (including tariffs)
- EUR/USD lower by 1.5% at 1.0930. Euro Area Apr Manufacturing PMI maintained its slump with France, Euro Zone, Italy at record lows; Germany and Spain at 10-year lows
- CHF currency was weaker as the recent Sight Deposit data suggests that SNB had dramatically stepped up its market battle to stop the franc from strengthening with the April readings registered its largest monthly rise most in five years
Economic Data
- (IN) India Apr PMI Manufacturing: 27.4 v 51.8 prior (1st contraction in 31 months)
- (SE) Sweden Apr PMI Manufacturing: 36.7 v 43.2 prior (2nd straight contraction)
- (NL) Netherlands Apr Manufacturing PMI: 41.3 v 37.0e (1st contraction in 3 months and lowest since May 2009))
- (HU) Hungary Apr Manufacturing PMI: 33.6 v 34.0e (2nd straight contraction)
- (PL) Poland Apr PMI Manufacturing: 31.9 v 34.6e (18th month of contraction and record low)
- (TR) Turkey Apr PMI Manufacturing: 33.4 v 48.1 prior (2nd straight contraction)
- (TR) Turkey Apr CPI M/M: 0.9% v 0.6%e; Y/Y: 10.9% v 10.8%e; CPI Core Y/Y: 9.9% v 10.7%e
- (TR) Turkey Apr PPI M/M: 1.3% v 0.9% prior; Y/Y: 6.7% v 8.5% prior
- (ES) Spain Apr Manufacturing PMI: 30.8 v 34.0e (2nd straight contraction and lowest since Dec 2008)
- (CH) Swiss Apr PMI Manufacturing: 40.7 v 35.0e (14th month of contraction)
- (CZ) Czech Republic Apr PMI Manufacturing: 35.1 v 30.7e (17th month of contraction)
- (IT) Italy Apr Manufacturing PMI: 31.1 v 30.0e (18th month of contraction and record low)
- (FR) France Apr Final Manufacturing PMI: 31.5 v 31.5e (confirmed 3rd straight contraction and a record low)
- (DE) Germany Apr Final Manufacturing PMI: 34.5 v 34.4e (confirmed 16th straight contraction and and lowest since Mar 2009))
- (EU) Euro Zone Apr Final Manufacturing PMI: # v 33.6e (confirmed 15th straight month of contraction and a record low)
- (GR) Greece Apr Manufacturing: 29.5 v 42.5 prior (2nd straight contraction and record low)
- (NO) Norway Apr PMI Manufacturing: 42.0 v 41.4 prior (2nd straight contraction)
- (CH) Swiss Weekly Total Sight Deposits (CHF): 663.8B v 650.7B prior; Domestic Sight Deposits: 579.5B v 573.9B prior
- (EU) Euro Zone May Sentix Investor Confidence: -41.8 v -28.0e
- (HK) Hong Kong Q1 Advance GDP Q/Q: -5.3% v -1.7%e; Y/Y: -8.9% v -6.4%e
- (ZA) South Africa Apr Manufacturing PMI: 46.1 v 39.5e (12th straight contraction)
Fixed Income Issuance
- (NO) Norway sold NOK3.0B vs. NOK3.0B indicated in 3-month Bills; Avg Yield: 0.25% v 0.33% prior; Bid-to-cover: 2.61x v 1.74x prior
- (SK) Slovakia Debt Agency (Ardal) sold total €310M in 9-month and 12-month Bills
Looking Ahead
- (ZA) South Africa Apr Naamsa Vehicle Sales Y/Y: -85.0%e v -29.7% prior
- (IT) Italy Apr Budget Balance: No est v -€32.2B prior
- (BR) Brazil Mar CNI Capacity Utilization: No est v 78.7% prior
- (BR) Brazil Apr Vehicle Sales: No est v 163.6K prior (Fenabrave)
- 05:30 (DE) Germany to sell combined €8.0B in 6-month and 9-month BuBills
- 05:30 (NL) Netherlands Debt Agency (DSTA) to sell €1.0-2.0B in 6-month Bills
- 05:30 (ZA) South Africa announces details of upcoming I/L bond sale (held on Fridays)
- 06:00 (IL) Israel Feb Manufacturing Production M/M: No est v 2.6% prior
- 06:00 (IL) Israel to sell 2022, 2025, 2029, 2030 and 2047 bonds (6 tranches)
- 06:00 (RO) Romania to sell RON500M in 4.15% 2028 Bonds
- 06:45 (US) Daily Libor Fixing
- 07:00 (TR) Turkey to sell 2021 Bonds – 07:00 (IN) India announces details of upcoming bond sale (held on Fridays)
- 07:25 (BR) Brazil Central Bank Weekly Economists Survey – 08:00 (UK) Baltic Dary Bulk Index
- 08:00 Spain Debt Agency (Tesoro) size announcement on upcoming issuance
- 08:30 (CL) Chile Mar Economic Activity Index (Monthly GDP) M/M: -5.4%e v 0.6% prior; Y/Y: -3.5%e v +2.7% prior; Economic Activity (ex-mining) Y/Y: No est v 2.0% prior
- 08:50 (FR) France Debt Agency (AFT) to sell €7.9-9.6B in 3-month, 6-month, 9-month and 12-month bills
- 09:00 (BR) Brazil Apr PMI Manufacturing: No est v 48.4 prior
- 09:00 (SG) Singapore Apr Purchasing Managers Index: 40.0e v 45.4 prior; Electronics Sector Index: No est v 44.1 prior
- 09:45 (US) April ISM New York: No est v 12.9 prior
- 09:45 (EU) ECB weekly QE bond buying update
- 10:00 (US) Mar Factory Orders: -9.4%e v 0.0% prior; Factory Orders (ex-transportation): No est v -0.9% prior
- 10:00 (US) Mar Final Durable Goods Orders: -14.4%e v -14.4% prelim; Durables (ex-transportation): -0.2%e v -0.2% prelim; Capital Goods Orders (non-defense/ex-aircraft): No est v 0.1% prelim; Capital Goods Shipments (non-defense/ex-aircraft): No est v -0.2% prelim
- 10:00 (MX) Mexico May Total Remittances: $2.8Be v $2.7B prior
- 10:00 (MX) Mexico Central Bank Economist Survey
- 10:30 (MX) Mexico Apr PMI Manufacturing: No est v 47.9 prior
- 11:00 (DK) Denmark Apr Foreign Reserves (DKK): No est v 372.1B prior
- 11:00 (CO) Colombia Apr PMI Manufacturing: No est v 49.3 prior
- 12:00 (IT) Italy Apr New Car Registrations Y/Y: No est v -85.4% prior
- 13:00 (MX) Mexico Apr IMEF Manufacturing Index: 35.0e v 45.0 prior; Non-Manufacturing Index: 28.0e v 39.5 prior
- 13:00 (US) Treasury to sell 26-Week Bills
- 14:00 (CO) Colombia Central Bank Apr Minutes
- 14:00 (BR) Brazil Apr Trade Balance: $6.2Be v $4.7B prior; Total Exports: $18.1Be v $19.2B prior; Total Imports: $11.8Be v $14.5B prior
- 16:00 (US) Weekly Crop Progress Report
- 18:30 (AU) Australia Apr Performance of Construction Index: No est v 37.9 prior
- 18:45 (NZ) New Zealand Mar Building Permits M/M: No est v 4.7% prior
- 19:00 (AU) Australia Apr Final PMI Services: No est v 19.6 prelim; PMI Composite: No est v 22.4 prior
- 19:30 (AU) Australia Weekly Roy Morgan Weekly Consumer Confidence Index: No est v 85.0 prior
- 20:30 (TH) Thailand Apr PMI Manufacturing: No est v 46.7 prior
- 21:00 (NZ) New Zealand Apr Commodity Price Index: No est v -2.1% prior
- 21:00 (PH) Philippines Apr CPI Y/Y: 2.1%e v 2.5% prior
- 23:30 (TH) Thailand Apr CPI M/M: -0.9%e v -0.9% prior; Y/Y: -1.1%e v -0.5% prior; CPI Core Y/Y: 0.4%e v 0.5% prior
- 23:30 (HK) Hong Kong to sell 3-month and 6-month bills
