China PMIs Were Mixed

Nov 01 21, 06:05 GMT

General trend

UST yields have risen at the start of the new month.
Nikkei 225 has extended rise.
Japan LDP wins outright majority in Parliament elections over the weekend. Speculation that PM could replace the second in command in the party.
China manufacturing PMI has its second consecutive contraction, while the Caixin manufacturing PMI has its second consecutive expansion.
Australia opens its borders to international flights today, NZ looking at re-opening retail soon.
Increased calls and speculation for the RBA to drop or change its bond yield target and or forward guidance. Tomorrow’s rate decision should be closely watched.
Japanese cos. due to report earnings include Kyocera, Shionogi and AGC.
Hang Seng and Shanghai Composite have lagged; Property indices decline, Travel-sensitive firms drop amid the focus on the rise in COVID cases; CN Banks rise after earnings results.
S&P ASX 200 has moved higher after opening flat [REITs rise after prior drop; Westpac’s results weigh on Financials].
Companies due to report during the NY morning include ON Semiconductor, PG&E, Timken.

Headlines/Economic Data

Australia/New Zealand.

ASX 200 opened 0.0%.
WBC.AU Reports FY21 (A$) Cash Net 6.95B v 2.6B y/y; adj Cash net 5.35B v 5.2B y/y, announces A$3.5B share off market buyback.
AST.AU To be acquired by Brookfield led consortium at A$2.65/shr cash.
(AU) Australia Oct Melbourne Institute Inflation M/M: 0.2% v 0.3% prior; Y/Y: 3.1% v 2.7% prior.
(AU) Westpac calls on Reserve Bank of Australia (RBA) to scrap its bond yield target and forward guidance that rate will remain on hold until 2024 at tomorrow’s meeting.
(AU) AUSTRALIA SEPT HOME LOANS VALUE M/M: -1.4% V -2.0%E; INVESTMENT LENDING M/M: +1.4% V -4.0% PRIOR.
(AU) Reserve Bank of Australia (RBA) Offers to buy A$1.60B in Govt bonds v A$1.60B prior; No offers for Apr 2024 yield target bond for YCC.
(AU) Australia opened boarders to international flights as of Nov 1st (1st time in 19 months).
(NZ) New Zealand PM Ardern: Auckland retail may reopen starting next week, Auckland will remain at level 3.
Apollo Consolidated: Ramelius increases unconditional offer for company to A$0.621/shr (Prior A$0.562/shr); Board unanimously recommends offer.

Japan

Nikkei 225 opened +1.5%.
(JP) Japan Election Results: Ruling LDP wins outright majority (as expected), Wins 261 seats in Parliament v 465 seats available (prior held 276 seats).
9432.JP CFO: Company market cap should be worth at least ¥15T within 2 years (20% higher from current level), additional buybacks may take place – press.
(JP) Japan PM Kishida: To pass extra budget ASAP; Will reveal full extent of coronavirus plan by mid Nov.
(JP) Japan Oct Final PMI Manufacturing: 53.2 v 53.0 prelim (confirms the 9th straight month of expansion, highest since April).
(JP) Japan Ruling bloc said to consider a special diet session for Nov 10th – press.
(JP) Japan MoF sells ¥2.6T v ¥2.6T indicated in 0.1% 10-year JGBs; avg yield 0.1070% v 0.0490% prior; bid to cover: 3.14x v 2.45x prior.

Korea

Kospi opened +0.5%.
(KR) South Korea Oct Trade Balance: $1.7B v $2.1Be; Chip exports y/y: 37.8%.
(KR) South Korea Oct PMI Manufacturing: 50.2 v 52.4 prior (12th month of expansion).
(KR) Korea sells 30-year bonds: avg yield 2.435% v 2.205% prior.

China/Hong Kong

Hang Seng opened -0.4%; Shanghai Composite opened -0.5%.
(CN) CHINA OCT MANUFACTURING PMI (GOVT OFFICIAL): 49.2 V 49.7E (2nd consecutive contraction).
(CN) CHINA OCT CAIXIN PMI MANUFACTURING: 50.6 V 50.0E (2nd consecutive expansion, 4 month high).
(CN) PBOC Newspaper: PBOC Local branches have provided a window guidance to local banks on Property loans; To keep property loans stable.
(CN) China PBOC backed Financial News: Yuan might remain under pressure, US dollar will likely strengthen as the Fed tapers bond purchases.
(HK) Macau Sept Casino Rev (MOP) 4.37B v 5.88B prior; Y/Y +57.3% v 165.9% prior.
(CN) China Foreign Min Wang and US Sec of State Blinken met for the first time since Alaska meeting, all talk focused on Taiwan – press.
(CN) China PBOC sets Yuan reference rate: 6.4192 v 6.3907 prior.
(CN) China PBOC Open Market Operation (OMO): Injects CNY10B in 7-day reverse repos v CNY200B prior; Net Drain CNY190B v Net inject CNY100B prior.
(CN) China Securities Journal: China PBOC not likely to cut RRR in the near term (in line with other speculation).

Other

2454.TW Expected to increase wafer chip prices by ~10% in 2022 – Press.
(TW) Taiwan Central Bank Gov Yang: Conditions for raising interest rates include inflation and rate increases in neighboring countries; Price rises will not spark inflation.

North America

(US) White House Press Sec Psaki: Tested positive for COVID on Sunday; Have not had close contact with Biden since Wednesday.
(CN) US Treasury Sec Yellen: Wants China to meet trade deal commitments; Looking at eventual reciprocal lowering of tariffs.

Europe

(UK) Govt spokesperson Blain: UK ready to respond to France in Brexit fish row; It is up to French govt to step back from threats.
(FR) French Pres Macron: G-20 agreed to coordinate on energy prices between energy consumers and producers.
(FR) France Oct Car Registrations Y/Y: -30.7% v -20.5% prior.
(IE) Ireland Oct PMI Manufacturing: 62.1 v 60.3 prior.

Levels as of 01:15ET

Hang Seng -1.1%; Shanghai Composite +0.1%; Kospi +0.4%; Nikkei225 +2.5%; ASX 200 +0.8%.
Equity Futures: S&P500 +0.2%; Nasdaq100 +0.2%, Dax +0.2%; FTSE100 +0.2%.
EUR 1.1565-1.1546; JPY 114.31.-114.03; AUD 0.7525-0.7499; NZD 0.7180-0.7153.
Commodity Futures: Gold +0.1% at $1,785/oz; Crude Oil -0.4% at $83.25/brl; Copper +0.3% at $4.39/lb.