Equity Markets Generally Reverse Gains

Oct 04 21, 06:28 GMT

General trend

Equity indices pare gains amid trading halts for Evergrande and Evergrande Property Services; Evergrande speculated to sell majority stake in Property Services unit to Hopson Development.
Vaccine makers trade generally lower after news related to Merck’s COVID pill.
Japanese shipping cos. extend losing streak.
Fast Retailing [largest Nikkei component] is due to issue monthly sales after the Tokyo close.
HK casino names reverse gains on Macau/Zhuhai news.
S&P ASX 200 rises after sharp drop on Friday [-2%]; Financials, Resources and Consumer Discretionary indices gain.
Singapore traded higher on reduced quarantine period for travelers arriving and easing of entry requirements.
NZD declined ahead of Wed’s RBNZ decision, there has also been some focus on the new COVID cases.
Soybean FUTs decline ahead of US comments on China trade strategy.
Shanghai markets are closed for holiday from Oct 1-7 (Fri-Thurs).

Headlines/Economic Data

Australia/New Zealand

ASX 200 opened 0.0%.
(NZ) RBNZ Shadow Board: Lockdown divides Shadow Board’s views on tightening.
(NZ) Reserve Bank of New Zealand (RBNZ): Maintaining focus on economic wellbeing and prosperity – Annual Report.
(AU) Reserve Bank of Australia (RBA): Excess cash at exchange settlement (ES) accounts at A$369.3B v A$365.8B prior.
CBA.AU Completes A$6.0B off market share buyback at A$88.62/shr (79.4% scale back rate applied above priority allocation).
(NZ) New Zealand PM Ardern: Extends Auckland Lv 3 lockdown, to be reviewed weekly; Rest of country to remain at lv 2.

Japan

Nikkei 225 opened +1.0%.
(JP) Japan LDP Sec Gen Amari said government will immediately compile a large extra budget after the general elections – financial press.
9984.JP Vision Fund 2 portfolio has quintupled the number of investments in startups in less then 9 months (115 so far) – press.
(JP) Japan Fin Min Aso (outgoing): Believe international tax agreement will be official this month, currency has remained stable, at one point proposed to BOJ to lower 2% CPI target.
(JP) Said that incoming Japan PM Kishida will hold a lower house election on Oct 31st – Press.
(JP) Japan parliament officially elects Kishida as PM.

Korea

China/Hong Kong

Hang Seng opened -0.4%; Shanghai Composite to reopen Friday.
6666.HK Hopson to acquire 51% stake for HK$40B – Chinese press.
(HK) Hong Kong largest independent trade union, Confederation of Trade Unions (HKCTU), disbanded on Sunday due to Security Law.
(HK) Hong Kong Govt adviser David Hui: Reopening border with China will take 4-5 months of talks – SCMP.
(HK) Hang Seng to announce Q3 review results Nov 19th.
(HK) Macau halts border resumption plan with China Zhuhai city (Guangdong Province).
992.HK Shanghai Exchange accepts application related to CDR issuance.

Other

(TW) China sent 77 warplanes into Taiwan defense zone over the past 2 days – Taiwan press citing Govt.

North America

(US) Fed Vice Chair Clarida in 2020 financial disclosure traded into stocks day before Powell made statement on pandemic [in Feb 2020], said they were pre-planned for rebalancing – press over weekend.
(CN) US Trade Rep Tai set to unveil China trade policy Monday after concluding top to bottom review of last administration’s trade policy; expected to say that China is not complying with the Phase 1 trade deal; US said to consider potential actions against China [including possible additional tariffs], cites non-compliance with trade deal..
NEO Guardant Health said to have decided against takeover offer – press.

Europe

(UK) Govt has drawn up proposal to permanently replace agreement with the EU that’s in place to maintain an open border between Ireland and Northern Ireland – UK press.
(UK) Reportedly UK Fin Min Sunak planning £500M fund to help people get into work – press.
(UK) Trade Sec Truss: A post Brexit agreement with US President Biden, is not the “be all to end all” of trade deals, refuses to commit to signing a FTA with US by 2030 – UK press.
(EU) Former ECB chief Trichet: In Europe, currently, you could say that the thesis that inflation is transitory can be accepted; the same claim in the US calls for some skepticism – press.

Levels as of 01:15ET

Hang Seng -2.1%; Shanghai Composite closed for holiday; Kospi closed for holiday; Nikkei225 -1.1%; ASX 200 +1.2%.
Equity Futures: S&P500 -0.1%; Nasdaq100 -0.3%, Dax -0.4%; FTSE100 -0.2%.
EUR 1.1614-1.1588; JPY 111.11-110.89; AUD 0.7283-0.7252; NZD 0.6953-0.6927.
Commodity Futures: Gold +0.2% at $1,761/oz; Crude Oil -0.4% at $75.61/brl; Copper -0.3% at $4.19/lb.