Asia Summary
Asian equity markets have opened the session mostly lower following the negative leads out of the US and ahead of the later today ECB decision.
Earnings reports out of Asia have been in focus on today’s session. Japanese industrial company Fanuc has traded higher by over 2%, as it raised its FY18 outlook.
In the tech sector, Japan’s Line Corp has gained over 13% as its Q3 earnings beat expectations. At the same time, chip equipment company Advantest has declined by over 3% after the company reduced its FY net profit forecast. South Korea’s Hynix has traded marginally lower after reporting in line profits and better than expected revenues.
The Shanghai Composite Consumer index has gained over 1.8%, as liquor producer Kweichow Moutai has risen by over 6% following its earnings report
In the financial sector, Daiwa Securities has gained over 4%, as the board announced an up to 3.1% share buyback with the H1 financial results. Singapore-based OCBC has traded flat after reporting in line Q3 results. In Australia, ANZ Bank has declined by over 1% on weaker than expected FY17 profits.
Chinese insurance companies are generally higher, as China’s 10-year bond yield has continued to trade at multi-year highs. The rise in bond yields follows Wednesday’s increase in US Treasury yields. China is also marketing its first US dollar denominated bonds since 2004. According to initial reports, orders for the 2 tranche issuance are said to exceed $10B.
South Korea’s 3-year bond yield has risen on the session, as the country’s prelim Q3 GDP data showed the fastest q/q growth rate in over 7-years.
Looking ahead, traders are expected to focus on the later today ECB decision. Japanese companies due to report earnings later today include Fuji Electric, Fujitsu, Hitachi, Koito Mfg Co, Kyowa Hakko Kirin, Mitsubishi Motors, NTT Docomo, Nomura Real Estate, Oki Electric, Osaka Gas, SBI Holdings, Seiko Epson and Tohoku Electric Power.
Companies out of China and Hong Kong expected to report results include Aluminum Corp of China, BYD, Bank of Communications, China Coal Energy, China Eastern Airlines, China Grand Auto, China Merchants Bank, China Pacific Insurance, China Railway, China Shenhua Energy, China Unicom, China Vanke, Everbright Securities, Great Wall Motor, Inner Mongolia Bao Tou Steel, Jiangxi Copper, New China Life Insurance, Ping An Insurance, Poly Real Estate, Sinopec Shanghai, Sinopharm Group and Xinjiang Goldwind.
US companies due to report results on Thursday include, Alphabet, Altria, Amazon, American Airlines, Baidu, Boston Beer, Charter Communications, ConocoPhilips, First Solar, Ford, Intel, Microsoft, Potash , UPS, Valero, Western Digital and Xerox.
Key economic data
(NZ) NEW ZEALAND SEPT TRADE BALANCE (NZ$): -1.14B V 0.9BE; YTD -2.91B V -2.71BE
(KR) SOUTH KOREA Q3 PRELIM GDP Q/Q: 1.4% V 0.9%E; Y/Y: 3.6% V 3.0%E
(JP) JAPAN SEPT SERVICES PPI Y/Y: 0.9% V 0.8%E
(AU) AUSTRALIA Q3 EXPORT PRICE INDEX Q/Q: -3.0% V -4.0%E; IMPORT PRICE INDEX Q/Q: -1.6% V -1.5%E
Speakers and Press
Japan
(JP) Japan PM Abe Adviser Hamada: Abe’s new approach for sales tax revenue is good
Korea
(KR) South Korea Finance Min Official: Q4 q/q GDP to be just over 0% as growth was focused on Q3
(KR) South Korea and China said to seek to resolve tensions related to Thaad – South Korean Press
(KR) North Korea official warns that hydrogen bomb threat should be taken literally – financial press
China/Hong Kong
(CN) China said to set initial pricing talk for planned 5 and 10-year US dollar denominated bonds (first USD issuance since 2004)
(CN) China Communist Party Sr Official: Will not set target to double GDP from 2021
(CN) China Official: China has shifted gears to medium-high growth rate
Australia/New Zealand
(NZ) New Zealand PM Designate Ardern to disclose 100-day plan early next week; taking advice on whether to have ‘mini-budget’
Asian Equity Indices/Futures (00:00ET)
Nikkei +0.3%, Hang Seng -0.2%; Shanghai Composite +0.5%; ASX200 -0.0%, Kospi -0.1%
Equity Futures: S&P500 +0.0%; Nasdaq100 +0.0%, Dax -0.1%; FTSE100 -0.1%
FX ranges/Commodities/Fixed Income (00:00ET)
EUR 1.1833-1.1813; JPY 113.71-113.37; AUD 0.7717-0.7697;NZD 0.6897-0.6872
Dec Gold +0.2% at $1,281/oz; Dec Crude Oil -0.2% at $52.09/brl; Dec Copper +0.1% at $3.18/lb
(NZ) New Zealand sells NZ$150M in 3.5% 2033 bonds; avg yield 3.3655%; bid-to-cover 2.86x
(CN) PBoC OMO: Injects CNY120B in 7 and 14-day reverse repos v CNY160B injected prior; injects net CNY20B v CNY0B prior
USD/CNY *(CN) PBOC SETS YUAN REFERENCE RATE AT 6.6288 V 6.6322 PRIOR
(JP) Japan MoF sells ¥2.199T in 0.1% (prior 0.1%) 2-yr JGBs; avg yield -0.1430% v -0.1490% prior; bid-to-cover 5.93x v 4.97x prior
(JP) Japan MoF sells ¥4.439T in 3-month bills; avg yield -0.1961%
Equities notable movers
Australia/New Zealand
ANZ.AU Reports FY17 (A$) Net 6.41B v 6.7Be; Cash profit 6.94B v 7.0Be; Op 20.3B v 20.7Be; -1.7%
RFX.AU Gives business update regarding Thailand operations; +10%
ISD.AU Guides FY18 (A$) EBITDA 32-36M; Rev 133-138M; To exit King Content business; Reaches settlement with Meltwater; -37%
Japan
3938.JP Reports 9-month Net profit ¥12.1B v 5.3B y/y, Op ¥24.5B v ¥18.3B y/y, Rev ¥121.2B v ¥103.2B y/y; +15%
6755.JP Reports H1 Net ¥5.8B v ¥5.7B y/y; Op ¥7.8B v ¥12.6B y/y; Rev ¥123.1B v ¥122.5B y/y; -6.7%
China/Hong Kong
3606.HK Reports 9M Net 2.14 v 2.18B y/y, Rev 13.4B v 11.6B y/y; +5.5%
Korea
000660.KR Reports Q3 (KRW) Net 3.05T v 3.0Te; Op 3.7T v 3.8Te; Rev 8.10T v 7.9Te
