Notes/Observations
- Risk aversion globally as China worries persist; Evergrande falls to 11 year lows.
- Tensions grow between France and Australia following cancelled submarine deal.
Asia
- China, Japan, South Korea and Taiwan closed for holiday.
- (HK) Macau official: want to hear gaming industry views on diversification; Stay open to opinions on license terms, local ownership.
- (IR) IAEA chief Grossi: North Korea’s nuclear program is going full steam ahead.
Europe
- (IT) Italy PM Draghi govt reportedly targets growth >10% for 2-year period 2021-2022.
- (UK) UK govt reportedly considers offering state-backed loans to energy firms amid gas prices surge.
- (DE) German weak-ahead baseload power price at €144.0/MWh +8.7% d/d.
- (UK) UK meat industry said to have warned about carbon dioxide (CO2) shortage; some meat firms have 5 days of available CO2 supply – press.
- EU Parliament Trade Committee Chair notes it will be more complicated to conclude EU-Australia trade agreement on the back drop of Australia’s submarine deal with the US-UK angering France.
Americas
- (US) Reportedly Senator Manchin (D-WV) considers the Congress should take a strategic pause until 2022 before voting on Pres Biden’s $3.5T social-spending package.
Speakers/Fixed income/FX/Commodities/Erratum
Equities
- Indices [Stoxx600 -1.67% at 454.14, FTSE -1.27% at 6,875.05, DAX -1.96% at 15,186.95, CAC-40 -1.91% at 6,444.91, IBEX-35 -1.84% at 8,599.50, FTSE MIB -2.07% at 25,178.00, SMI -1.40% at 11,768.70, S&P 500 Futures -1.08%].
- Market Focal Points/Key Themes: European indices open down across the board and move further into the red as the session progressed; risk sentiment impacted by concerns over housing market in China; less negative sectors include consumer discretionary and health care; sectors leading to the downside include materials and financials; reportedly Sainsbury’s looking to fend off takeover; no major earnings expected during the upcoming US session.
Equities
- Consumer discretionary: Lufthansa [LHA.DE] +2% (capital raise).
- Financials: Prudential [PRU.UK] -7% (capital raise in HK).
- Healthcare: AstraZeneca [AZN.UK] +3% (trial data), Santhera Pharmaceuticals [SANN.CH] -18% (earnings; funding).
- Technology: Zoo Digital [ZOO.UK] +3% (trading update).
- Utilities: SSE [SSE.UK] -1% (refutes media rumors on breakup of company).
Speakers
- (UK) Business Sec Sharma: UK govt is currently confident there is no risk to the gas supply to consumers – weekend press interview.
- (EU) EU Economic Commissioner Gentiloni (Italy): Not in Ireland to pressure on tax rate.
- (UK) Business Sec Sharma: UK govt is currently confident there is no risk to the gas supply to consumers.
- (EU) EU Parliament Trade Committee Chair: It will be much more complicated now to conclude EU-Australia trade agreement.
- (EU) EU Parliament Trade Committee Chair: It will be much more complicated now to conclude EU-Australia trade agreement.
- (CZ) Czech Central Bank Dep Gov Nidetzky: 100bps Czech hikes are possible by end-2021.
Currencies/Fixed Income
- Overall dollar strength puts most pairs under pressure with demand for safe havens. EUR/USD just above the 1700 handle, just ~30pips over the year’s low.
- Turkish Lira (TRY) falls past 8.72 per US dollar (USD) level, lowest since July 2021.
Economic data
- (DE) Germany Aug PPI M/M: 1.5% v 0.8%e; Y/Y: 12.0% v 11.1%e.
- (HU) Hungary Q2 Current Account: -€0.8B v -€0.5Be.
- (PL) Poland Aug PPI M/M: 0.6% v 0.7%e; Y/Y: 9.5% v 9.3%e.
- (PL) Poland Aug Sold Industrial Output M/M: -2.5% v -1.1%e; Y/Y: 13.2% v 14.6%e.
- (CH) Swiss weekly Total Sight Deposits (CHF): 714.7B v 714.8B prior.
- (ES) Spain July Trade Balance: -€1.6B v -€1.0B prior.
- (HK) Hong Kong Aug CPI Composite Y/Y: 1.6% v 1.6%e.
Fixed income Issuance
- (PH) Philippines sells total PHP15.0B vs. PHP15.0B indicated in 3-month, 6-month and 12-month bills.
- (EU) European Investment Bank (EIB) to sell PLN-denominated 3.0% May 2024 bonds; guidance seen +20bps to Polish Treasuries.
Looking Ahead
- 06:00 (IE) Ireland July Trade Balance: No est v €4.7B prior.
- 07:00 (MX) Mexico Q2 Aggregate Supply and Demand: No est v -2.9% prior.
- 07:25 (BR) Brazil Central Bank Weekly Economists Survey.
- 07:30 (CL) Chile Central Bank Traders Survey.
- 08:00 (UK) Daily Baltic Dry Bulk Index.
- 08:30 (CA) Canada Aug Teranet/House Price Index M/M: No est v 2.0% prior; Y/Y: No est v 17.8% prior; HPI Index: No est v 281.67 prior.
- 08:30 (UR) Ukraine Q2 Final GDP Q/Q: No est v -0.8% prelim; Y/Y: No est v 5.4% prelim.
- 10:00 (US) Sept NAHB Housing Market Index: 74e v 75 prior.
- 16:00 (US) Weekly Crop Progress Report.
- 17:00 (NZ) New Zealand Q3 Consumer Confidence: No est v 107.1 prior.
- 19:30 (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence Index: No est v 103.1 prior.
- 21:30 (AU) RBA Sept Minutes.
- 23:00 (NZ) New Zealand Aug Credit Card Spending M/M: No est v -0.6% prior; Y/Y: No est v 6.9% prior.
Speakers/events
- 07:00 (SE) Sweden Parliament debates budget proposal.
- 21:30 (AU) RBA Sept Minutes.
- (CA) Canada Federal Election.
Fixed Income
- 01:00 (KR) Bank of Korea (BOK) sell KRW in 3-month Monetary Stabilization Bonds (MSB Bonds; Avg Yield % v % prior.
- 01:00 (PH) Philippines to sell combined PHP in 3-month, 6-month and 12-month bills.
- 05:00 (EU) Daily Euribor Fixing.
- 05:00 (SK) Slovakia Debt Agency (Ardal) to sell 2030, 2036 and 2047 Bonds.
- 05:30 ((DE) Germany to sell 6-month and 12-month Bubills.
- 05:30 (NL) Netherlands Debt Agency (DSTA) to sell €1.5-2.5B in 6-month Bills.
- 05:30 (ZA) South Africa announces details of upcoming I/L bond sale (held on Fridays).
- 06:00 (IL) Israel to sell bonds.
- 06:00 (RO) Romania to sell RON300M in 4.15% Jan 2028 Bonds.
- 07:00 (TR) Turkey to sell Bonds (2 tranches).
- 06:45 (US) Daily Libor Fixing.
- 08:00 (IN) India announces details of upcoming bond sale (held on Fridays).
- 09:00 (FR) France Debt Agency (AFT) to sell €B in 3-month, 6-month and 12-month bills.
- 11:30 (US) Treasury to sell 13-Week and 26-Week Bills.
- 23:00 (TH) Thailand Central Bank to sell THB55B in 3-month bills.
- 23:30 (HK) Hong Kong to sell 3-month and 6-month Bills.
- 22:30 (JP) Japan to sell 6-Month Bills.
