General Trend:
- Nissan Motor rises over 4%, some cite focus on possible restructuring measures
- Westpac: Made large number of admissions in response to the statement of claim by AUSTRAC [relates to previously disclosed civil proceedings about money laundering]
- Bluescope (Aussie steelmaker): Confirmed IT systems affected by cyber incident
- Taiwan Semi: Confirmed it will build a semiconductor lab in the US (Arizona); To cost $12B from 2021-2029
- Hon Hai (Apple supplier) is expected to report Q1 results later today
- Megabank earnings in focus for Japan
- China PBOC is due to hold next monthly setting of loan prime rates (LPRs) on Wed (May 20th)
Headlines/Economic Data
Australia/New Zealand
- ASX 200 opened +0.3%
- (AU) Australia PM Morrison: Financial markets are fragile but functional; Insolvencies are running below average; Withdrawals from superannuations [pension fund] not creating liquidity issues
- (AU) Australia sells A$2.0B v A$2.0B indicated in 2.75% April 2024 bonds, avg yield 0.2818%, bid to cover 5.4x
- (AU) Australia (AOFM): To issue A$5.0B in bonds next week in 3 tenders
- (NZ) New Zealand Apr Business Manufacturing PMI: 26.1 v 38.0 prior (lowest level since survey started)
- (NZ) New Zealand Apr REINZ House Sales y/y: -78.5% v -4.8% prior
- (NZ) Reserve Bank of New Zealand (RBNZ) buys NZ$450M v NZ$450M prior in government bonds as part of QE
- (NZ) Reserve Bank of New Zealand (RBNZ): Will seek to purchase NZ$1.35B in government bonds next week under QE program vs NZ$1.35B prior
- (NZ) New Zealand Debt Management Office (DMO) sells NZ$1.05B v NZ$1.05B indicated in 2023, 2029 and 2037 bonds
China/Hong Kong
- Shanghai Composite opened +0.4%, Hang Seng opened flat
- (CN) China National Bureau of Statistics (NBS): Economic indicators showed improvement in April. domestic economy is recovering gradually; Reiterates economic recovery faces challenges – Press conference following April data
- (CN) CHINA APR INDUSTRIAL PRODUCTION Y/Y: +3.9% V +1.5%E; YTD Y/Y: -4.9% V -5.4%E
- (CN) CHINA APR RETAIL SALES Y/Y: -7.5% V -6.0%E; YTD Y/Y: -16.2% V -15.6%E
- (CN) CHINA APR FIXED URBAN ASSETS YTD Y/Y: -10.3% V -10.0%E
- (CN) China Apr Surveyed Jobless Rate: 6.0% v 5.8%e
- (CN) China Apr Property Investment YTD y/y: -3.3% v -4.8%e
- (CN) CHINA PBOC CONDUCTS CNY100B 1-YEAR MEDIUM-TERM LENDING FACILITY (MLF) OPERATION: RATE 2.95% V 2.95% PRIOR; Confirms second phase of targeted RRR cut went into effect today [originally announced on April 3rd]
- (CN) China Daily: New stimulus package to ease coronavirus woes , expected policy to focus on increasing consumption and strengthening demand; China is likely to come up with a fiscal stimulus package during the upcoming National People’s Congress (NPC)
- (US) President Trump: Having a strong dollar is a great thing; US is “going to be strong again”; Do not want to talk to Xi, could consider cutting US-China ties – Fox taped interview (from May 14th)
- (CN) China Global Times Editor in Chief Hu Xijin: I am asked a lot recently: Will a war break out between China and the US? My answer: The two countries increasingly dislike each other, various conflicts are rising, therefore, risk for a military clash is increasing. But meanwhile, they both don’t want a war. Am I right? (from May 14th)
- (US) Treasury Sec Mnuchin: Pres Trump is reviewing all of his options on China – Fox Business interview
- (US) USTR extends more exclusions out to Dec 18th on certain Chinese imports
- (US) US Senator Blackburn (R, TN) has urged colleagues to refuse meetings with companies from China (including Huawei and TikTok), suggested the move could be a ‘warning shot’ to China regarding coronavirus – Axios
- (CN) US Senate passes Uighur Human rights bill
- (CN) Wuhan (China): Has conducted >3M nucleic acid tests, has recently identified ‘several’ asymptomatic coronavirus cases ‘every day’; To conduct nucleic acid tests for all citizens to assess asymptomatic numbers. – Xinhua
- (CN) Jilin Province (Northeastern China), China: reports 4 additional coronavirus cases
- (CN) China National Health Commission Coronavirus Update for May 15th: 4 additional cases (0 imported v 0 prior) v 3 prior; Additional deaths: 0 v 0 prior — Xi calls for ‘vigilance’ to combat coronavirus (China Daily)
- (CN) China PBOC sets Yuan reference rate:7.0936 v 7.0948 prior
- (CN) China PBoC Open Market Operation (OMO): Skips Reserve Repo Operations for the 29th consecutive session; Net CNY0B v CNY0B prior
- (CN) China Finance Ministry (MOF) sells 30-year bonds: avg yield 3.5111% v 3.2880% prior, bid to cover 2.8x v 3.1x prior
- (HK) Hong Kong May New Home sales +250% m/m, month to date – HK Press
Japan
- Nikkei 225 opened +1.2%
- (JP) BOJ Gov Kuroda: reiterates view that domestic economy to be severely impacted by coronavirus outbreak; expects Q2 GDP to be substantially depressed (comments from May 14th)
- (JP) Japan Fin Min Aso: Lifting emergency measures in prefectures will not affect size of 2nd extra budget; Aiming to decide on 2nd extra budget draft on May 27th
- *(JP) JAPAN APR PPI (CGPI) M/M: -1.5% V -0.8%E (largest decline since 2009); Y/Y: -2.3% V -1.4%E (largest decline since 2016)
- (JP) Tokyo (Japan) reported to have drafted criteria to reopen economy due to declining cases; Will not ease restrictions until at least June – Japan Press
- (JP) Japan Government Spokesman: Sept start for Japan’s school year is being discussed across ministries
Korea
- Kospi opened +0.7%
- (KR) South Korea: confirms 148 nighclub linked coronavirus cases v 133 prior
- South Korea, China, and Japan health ministers to meet later today
- (KR) South Korea Vice Fin Min Kim: There is determination to stabilize the housing markets; Will actively respond to speculative housing purchases
- (KR) South Korea Apr Export Price Index m/m: -1.6% v -1.6% prior; y/y: -5.9% v -3.8% prior
Other Asia
- Asia Development Bank (ADB): Estimates there could be 158M-242M jobs lost due to coronavirus, economic impact of the virus could reach $8.8T [vs $2.0T-4.1T prior estimate related to global cost of coronavirus]
- (ID) Indonesia Apr Exports Y/Y: -7.0% v -2.7%e
North America
- (US) White House ‘would likely’ support new round of stimulus checks – CNBC [reminder: Pres Trump: Talking about more relief checks for Americans (comments from April 30th)]
- (US) Sen Maj Leader McConnell: Not ruling out another stimulus; Anticipating having to act again to help economy during coronavirus – Fox News Interview
- (US) House Democrats reportedly believe they have sufficient votes to pass $3T coronavirus stimulus bill tomorrow – Politico
- (US) House Speaker Pelosi: Everything is on the table for stimulus negotiations
- (US) Fed’s Kaplan (dove, voter): Believes unemployment rate will be at 10% end of year; Need more stimulus to bring down unemployment; reiterates does not favor Fed using negative interest rates, negative rates in the US could do ‘great damage’
- (US) Fed Total Balance Sheet Size as of May 14th: $6.98T (record) v $6.77T w/w
- Abbott Labs [ABT]: FDA: Has received 15 adverse event reports about the Abbott ID NOW device that suggest some users are receiving inaccurate negative results
- (US) New York Gov Cuomo: New York stay at home order will be extended until June 13th [unless regions meet certain conditions]; Cuomo said on Thursday 5 regions (including central NY) will be ready to open on May 15th, other places can be ‘un-paused’ the moment they reach their benchmarks – Press [in line with prior reporting]
Levels as of 1:20 ET
- Nikkei 225, +0.6%, ASX 200 +1.2%, Hang Seng +0.3%; Shanghai Composite +0.3%; Kospi +0.3%
- Equity Futures: S&P500 +0.1%; Nasdaq100 +0.3%, Dax -0.1%
- EUR 1.0808-1.0798; JPY 107.43-107.18 ; AUD 0.6474-0.6446 ;NZD 0.6016-0.5985
- Gold flat at $1,740/oz; Crude Oil +0.9% at $27.80/brl; Copper +0.1% at $2.366/lb
