General Trend:
- New virus outbreaks hurt efforts to reopen the global economy; notes new infections in South Korea, Germany and China – FT
- US President Trump may comment on China and trade this week [Reminder from May 6th: Pres Trump said: China may or may not keep the trade deal; next week we can report on whether China is fulfilling its obligations under the deal]
- Japanese automakers track Friday’s gains in the US; Others sectors moving higher in Japan include Marine/Transportation, Real Estate and Iron/Steel.
- Early gainers in Shanghai include Telecom Services and Consumer Discretionary companies
- Companies moving higher in Hong Kong include technology, energy, gaming and property firms
- Geely rises as China passenger vehicle sales improved in April
- Gainers in Australia include Energy, Consumer Discretionary and Financial firms
- NZ PM confirms easing of lockdown measures to level 2 [from level 3]
Headlines/Economic Data
Australia/New Zealand
- ASX 200 opened +0.3%
- (NZ) New Zealand Apr Card Spending Retail m/m: -46.8% v -50.1%e; Total m/m: -48.0% v -8.7% prior
- CIM.AU Reports Q1 Net (A$) 166M v 181M y/y; Rev 3.3B v 3.4B y/y
- (AU) Reserve Bank of Australia (RBA): Excess cash at exchange settlement (ES) accounts at A$62.9B v A$65.9B prior
- (AU) Reserve Bank of Australia (RBA) adds A$785M to banking system through repos v A$1.78B prior
- (AU) Reserve Bank of Australia (RBA) skips bond buying for second consecutive session
- (NZ) Reserve Bank of New Zealand (RBNZ) buys NZ$450M v NZ$450M prior in government bonds as part of QE
- (AU) China said to consider imposing tariffs on imports of barley from Australia – financial press
- (NZ) New Zealand May Prelim ANZ Business Confidence: -45.6 v -66.6 prior
- SKC.NZ CEO Stephens: Will commence consultation on a proposal to reduce the number of staff by ~700 (~33% of Auckland staff) to ensure the business is prepared to operate in the new environment
Japan
- Nikkei 225 opened +0.8%
- (JP) Japan govt reported to be compiling 2nd extra budget to combat the effects of the coronavirus pandemic, is expected to pass in current diet session – Nikkei
- (JP) Bank of Japan (BOJ) Summary of Opinions from Apr 27th decision: High priority task is to prevent companies from going bankrupt and jobs lost; timing of hitting inflation target to be delayed may face contractions in GDP as seen during Great Depression in 1930s
- (JP) Japan Econ Min Nishimura: State of Emergency could be declared again if new casts “shoot up”
- (JP) Japan PM Abe: Decision on whether and what additional stimulus steps are needed will be made taking into account how many prefectures are able to end their state of emergency
- (JP) Japan Govt will apply new foreign investment rules to companies that manufacture avigan – Japan press
- (JP) Bank of Japan (BOJ) announcement related to daily bond buying operation: raises buying of 3-5 yr JGBs
Korea
- Kospi opened +0.4%
- (KR) South Korea Apr Foreigners sold a net KRW5.4T in local stocks (3rd consecutive month) – Yonhap
- (KR) South Korea May 1-10th Exports y/y: -46.3% v -18.6% prior, Imports y/y: -37.2% v -13.0% prior
China/Hong Kong
- Hang Seng opened +1.0%; Shanghai Composite opened +0.2%
- (CN) China PBOC Q1 Monetary Report: Will step up counter-cyclical adjustment to support the real economy and fend off risks; Restoring development of the real economy will be put at a more prominent position
- (CN) For May 9th China reported its first coronavirus case in Wuhan since Apr 3rd (as part of 14 reported for the day) – press
- (CN) China National Health Commission Coronavirus Update for May 7th: 17 additional case (7 imported) v 14 prior; Additional deaths: 0 v 0 prior; Additional Asymptomatic cases: 12 v 20 prior
- (CN) China PBoC Open Market Operation (OMO): Skips Reserve Repo Operations for the 25th consecutive session; Net CNY0B v CNY0B prior
- (CN) China PBOC sets Yuan reference rate: 7.0769 v 7.0788 prior
- (CN) China Vice premier Liu He, US Treasury Sec Mnuchin and USTR Lighthizer spoke on Friday on bilateral trade; China is not close to meeting US purchase demands under Phase 1 trade deal; all parties vowed to implement their trade deal and boost cooperation on public health – SCMP
Other
- (SA) Saudi Arabia will raise its VAT from 5% to 15%, effective July 1st; To cut spending by SAR100B
North America
- (US) US Govt in talks with US chip makers about expanding and accelerating plans for chip factories in the US, amid concerns about relying too much over overseas manufacturing – press
- (US) Trump: Starting early next week, at my order, the USA will be purchasing, from our Farmers, Ranchers & Specialty Crop Growers, 3 Billion Dollars worth of Dairy, Meat & Produce for Food Lines & Kitchens. “FARMERS TO FAMILY FOOD BOX” Great news for all! – tweet
- (US) Vice president Pence to self isolate after his aide tested positive for coronavirus; Fauci also said to be doing a “modified” quarantine after “low risk” contact with Pence’s spokeswoman – press
- (US) US Treasury Sec Mnuchin said unemployment situation is temporary, the reported numbers are probably going to get worse before they get better – Fox News
Europe
- (UK) Govt to extend wages subsidy scheme to September – UK press
- (IE) Ireland Apr Construction PMI: 4.5 v 28.9 prior (record low)
- (CH) SNB President Jordan: Swiss National Bank has no alternative to its ultra expansive monetary policy, with the coronavirus crisis putting “enormous” appreciation pressure on the safe haven Swiss franc – press
Levels as of 1:15ET
- Hang Seng +1.8%; Shanghai Composite -0.1%; Kospi -0.2%; Nikkei225 +1.5%; ASX 200 +1.6%
- Equity Futures: S&P500 +0.3%; Nasdaq100 +0.4%, Dax +0.5%; FTSE100 +1.2%
- EUR 1.0851-1.0825; JPY 107.02-106.53; AUD 0.6562-0.6514; NZD 0.6156-0.6123
- Commodity Futures: Gold -0.5% at $1,704/oz; Crude Oil -1.6% at $24.34/brl; Copper 0.0% at $2.41/lb
