General Trend
- Following the higher openings, Asian equity indices are generally off of the session’s best levels
- Nikkei is closer to the opening level [Transports outperform, Pharma index drops]; Shanghai ended the morning session lower following the higher opening [Consumer stocks continued to weigh]; Hang Seng erased opening gain of more than 1% [TECH index declines, particularly food delivery firms; Large China Telecoms outperform ]
- Copper miners supported by higher base metals prices; Financials trade mixed despite higher longer-term gov’t bond yields
- Rare earth miners rise amid additional press speculation about possible export restrictions by China; China also issued its first batch of rare earth smelting quotas for 2021
- Earnings reactions: [Australia]: oOH!Medida, Costa Group, Macquarie Group, Bluescope Steel and NIB Holdings rise; Reliance Worldwide declines; [Hong Kong]: CLP rises
- Boeing recommends suspending certain 777 planes with Pratt & Whitney 4000 engines [followed issue related to United Airlines flight]
- HK said to consider SPACs
- RBA steps up bond purchases amid yield rise , first time is has conducted bond purchases for yield curve control in 2-months
- Japan markets will be closed on Feb 23rd (Tues) for holiday
- HSBC is due to report FY earnings on Feb 23rd (Tuesday)
- Companies expected to report during the NY morning include Cooper Tire, Discovery Inc, DISH Network, KBR Inc, Royal Caribbean, Transocean
Headlines/Economic Data
Australia/New Zealand
- ASX 200 opened +0.2ampol%
- BOQ.AU Confirms to acquire ME Bank for A$1.33B, also announces A$1.35B capital raise
- ALD.AU Reports FY20 (A$) RCOP adj Net 212M v 344M y/y; RCOP adj EBIT 401M v 607M y/y; Rev 15.43B v 22.35B y/y; Lytton refinery review remains ongoing
- (AU) Reserve Bank of Australia (RBA) to buy A$3.0B in Govt bonds v A$2.0B prior (A$2.0B in purchase program; A$1.0B in 3-year yield target)
- (NZ) S&P raises New Zealand sovereign rating one notch to AAA from AA+; Outlook stable from positive
- (AU) Fitch affirms Australia sovereign rating at AAA; Outlook negative
Japan
- Nikkei 225 opened +0.9%
- (JP) Japan Econ Min Nishimura: Japan Economic growth beginning in 2022 will be low compared to EU countries and US
- 7267.JP Confirms to appoint Toshihiro Mibe as next president, effective April 1st
- (JP) Japan Jan Crude Steel Output: Crude output 7.92Mt, +5.3% m/m, -3.9% y/y – Industry body, Japan Iron and Steel Federation
Korea
- Kospi opened +0.2%
- (KR) South Korea Feb 1-20th Exports Y/Y: 16.7% v 10.6% prior; Imports Y/Y: 24.1% v 1.5% prior; Chip Exports y/y: 27.5% v +11.6% prior
- (KR) South Korea Ruling Party said to decide extra budget size by the end of Feb; to submit budget plan to Parliament next week (1st week of March) – Press
China/Hong Kong
- Hang Seng opened +1.4%; Shanghai Composite opened +0.3%
- 1810.HK Comments on press report it was planning to enter EV market: have not made any formal move to enter the market
- (CN) China CBIRC implements new restrictions on internet lending platforms: Banks must cap overall joint lending with internet platforms or other partners at no more than 50% of their outstanding loans
- (CN) China 2021 PPI might rise ~2% y/y – China Securities Journal
- (CN) China Senior Diplomat Yi: Xinjian and Tibet shining examples of China human rights progress due to socio economic development; Asks for removal of unreasonable tariffs on China Goods; China has no intention to challenge or replace the US
- (CN) CHINA PBOC MONTHLY LOAN PRIME RATE (LPR) SETTING: LEAVES BOTH 1-YEAR AND 5-YEAR RATES UNCHANGED (as expected, 10th straight month, update from weekend)
- (CN) China PBOC Open Market Operation (OMO): Injects CNY10B in 7-day reverse repos v CNY20B in 7-day reverse repos prior; Net drain CNY40B v Net drain CNY80B prior
- (CN) China PBOC sets Yuan reference rate: 6.4563 v 6.4624 prior
- (CN) China Ambassador Cui Tiankai: China will never back down on sovereignty, this includes red line on Taiwan and Hong Kong
- (HK) Hong Kong Exchange said to be studying Blank Check Companies (SPAC) – Press
- (HK) Hong Kong Budget to be released Feb 24th: Fin Min Chan thought to be navigating a deficit of HK$350B, measures will focus on high unemployment rate, not expected to announce cash handouts or give the public housing residents a 1-month waiver like last year
- (CN) China Agriculture Min Tang Renjian: Hog supplies expected to return to levels seen at the end of 2017 by approx June – comments after China announces measures to boost grain supplies and increase food security
Other
- (TW) Taiwan Semiconductor Industry Association: 2020 Taiwan chip industry Rev $108.9B, +20.9% y/y
North America
- BA US Federal Aviation Authority (FAA) issues emergency directive after issue at Denver where a Boeing 777 with a Pratt & Whitney 4000 engine, lost engine pieces over homes in the area, passengers reported a large explosion shortly after takeoff
- RTX Pratt & Whitney issues statement on United Airlines flight 328; Coordinating for revised inspections related to the PW4000 engines that power the Boeing 777
- TCOM Said to have submitted application to Hong Kong Exchange for IPO ahead of China New Year – HK press
Europe
- (UK) Chancellor of the Exchequer Sunak (Fin Min) expected to raises taxes from 19% to 23% by the next general election, on businesses in order to fund extended COVID support programs as part of budget to be released in March – US press
- (UK) PM Johnson to announce easing of lockdown Monday, all schools to re-open March 8th
Levels as of 12:15ET
- Hang Seng -0.4%; Shanghai Composite -0.3%; Kospi -0.7%; Nikkei225 +0.7%; ASX 200 -0.2%
- Equity Futures: S&P500 -0.2%; Nasdaq100 -0.3%, Dax -0.0%; FTSE100 -0.1%
- EUR 1.2135-1.2113; JPY 105.73-105.40; AUD 0.7908-0.7867; NZD 0.7338-0.7291
- Commodity Futures: Gold +0.4% at $1,784/oz; Crude Oil +1.2% at $59.94/brl; Copper +3.0% at $4.19/lb
