Equities Remain Quiet Ahead Of US Fed Meeting

May 02 18, 07:53 GMT

General Trend:

Asian equity markets trade mixed as various markets return from holiday
Australia ASX 200 outperforms: Qantas rallies over 6% after guidance
Australian retailer Woolworth’s expects deflation related to fruit and vegetable prices to remain high in Q4
Aluminum producer Rusal rises over 4% after reprieve from US Treasury Dept.
Standard Chartered Q1 adj pretax shy of ests
HK-listed gaming companies trade higher on April Macau Casino Revs
US equity futures trade mixed as traders digest Apple’s results and US political risks; Fed decision expected later on Wed
Commodities trade generally higher ahead of Fed meeting; Silver Futures up over 1%
China conglomerate HNA Group reports 2017 results
China April Caixin PMI manufacturing export orders sub-index declines for first time since 2016
South Korea April PMI contracts for 2nd straight month, hits 1-year low
South Korea sells 30-year bonds at higher yield
Japan monetary base rises at slowest pace since 2012
USD/JPY trades below ¥110.00 ahead of upcoming Fed decision
Japanese equity markets are closed on Thursday and Friday (May 3-4th)
Trade talks between US/China due to begin on Thursday
RBA Gov Lowe suggests no large changes in forecasts due for release on Friday
PBOC sets weaker yuan setting ahead of US trade delegation visit

Headlines/Economic Data

Japan

Nikkei 225 opened +0.3%; closed -0.2%
TOPIX Real Estate index -1.3%, Information/Communications -0.7%, Securities -0.4%, Retail Trade -0.3%; Marine Transportation +0.3%
Automakers trade lower after release of monthly US auto sales
Shares of Yamato Holdings [9064.JP] and Japan Tobacco [2914.JP] rise over 5% following their respective earnings reports
(JP) Support for PM Abe revising constitution declines to 30% – Asahi Poll
(JP) Japan govt plans to delay primary budget surplus target by five years to fiscal 2025 – Nikkei
(JP) Japan Govt said to be considering fiscal FY25 as its new target for fiscal consolidation – Nikkei
(JP) JAPAN APR PMI COMPOSITE: 53.1 V 51.3 PRIOR; SERVICES: 52.5 V 50.9 PRIOR (6-month high)
Itochu, 8001.JP Reports FY17/18 Net ¥400.3B v ¥352.2B y/y; Op ¥316.9B v ¥288.4B y/y; Rev ¥5.51T v ¥4.84T y/y

Korea

Kospi opened 0%
(KR) SOUTH KOREA APR CPI M/M: 0.1% V 0.1%E; Y/Y: 1.6% V 1.5%E
Samsung Biologics, [-15%], 207940.KR Financial Supervisory Service (FSS) finds accounting violation
(KR) South Korea Apr PMI Manufacturing: 48.4 v 49.1 prior
(KR) South Korea President Spokesperson: US troops in South Korea are not related to peace treaty with North Korea
(KR) Bank of Korea sells KRW2.3T in 2-yr bonds; avg yield 2.145%
(KR) South Korea sells KRW1.85T in 30-yr bonds, avg yield 2.75% v 2.66% prior
(KR) South Korea Finance Min Kim: Most worried about jobs data recently

China/Hong Kong

Hang Seng opened -0.1%, Shanghai Composite +0.2%
Hang Seng Materials index -1.7%, Financials -1.2%, Property/Construction -1%; Services +1.6%
(CN) China may soon release policies aimed at boosting consumption – China Daily
(CN) China PBoC sets yuan reference rate at 6.3670 v 6.3393 prior (weakest setting since Jan 25th)
(CN) China PBoC Open Market Operation (OMO): Injects CNY200B in 7-day reverse repos v CNY40B prior; Net: drains nil v nil prior
(CN) CHINA APR CAIXIN PMI MANUFACTURING: 51.1 V 50.9E; Export orders sub component falls for the first time since Nov 2016
(HK) Hong Kong 3-month HIBOR rises to 1.61607% (highest level since 2008, 13th consecutive daily increase)
(US) US Treasury: Extends deadline for divestiture or transfer of debt and other financial holdings of sanction targets EN+, GAZ and Rusal to June 6th

Australia/New Zealand

ASX 200 opened 0%, closed +0.6%
ASX 200 Consumer Discretionary index +1.4%, REIT +0.7%, Utilities +0.6%, Financials +0.4%
JB-HiFi,[-8%] JBH.AU Reports Q3 Rev +6.8% v 10.8% y/y; cuts FY18 guidance
Woolworths, [+0.7%], WOW.AU Reports Q3 Rev A$14.2B v A$13.7B y/y
Qantas[+6%], QAN.AU Reports Q3 (A$) Rev 4.25B, +7.5% y/y; Affirms FY18 guidance
(NZ) NEW ZEALAND Q1 UNEMPLOYMENT RATE: 4.4% V 4.4%E;EMPLOYMENT CHANGE Q/Q: 0.6% V 0.6%E; Y/Y: 3.1% V 3.3%E
(AU) Fitch affirms Australia sovereign rating at AAA; Outlook Stable
(AU) Australia sells A$400M v A$400M indicated in 3.00% March 21 2047 bonds, avg yield 3.2741% v 3.3268% prior, bid to cover 3.06x v 3.00x prior
(AU) Australia PM Turnbull: Free trade and open markets are good for jobs; Have signed cyber co-operation agreement with France
(AU) Reserve Bank of Australia (RBA) Gov Lowe speaks at board dinner: latest forecasts due to be released Friday should not contain any surprises with only small changes from last set of forecasts

Other Asia

(ID) Indonesia Central Bank: To purchase more government bonds in secondary market; seeks to stabilize domestic bond market
(TW) Taiwan Apr PMI Manufacturing: 54.8 v 55.3 prior (6-month low)
(TW) Taiwan said to plan to ease impact of rising retail gasoline prices – Local Media
Taiwan Semi [2330.TW]: Nanjing plant said to have started mass production – Taiwanese Press

North America

US equity markets ended mostly higher: Dow -0.3%, S&P500 +0.3%, Nasdaq +0.9%, Russell 2000 +0.6%
S&P500 Technology +1.3%; Consumer Staples -0.9%
Apple’s [AAPL] shares rise over 3% in the afterhours following results and announcement regarding shareholder returns
Xerox [XRX]: Confirms Reaches Agreement with Carl Icahn and Darwin Deason: Keith Cozza of Icahn Enterprises to be Named Chairman; John Visentin to be Named Vice Chairman and CEO; to immediately discuss strategic alternatives
(US) Special Counsel Mueller said to have raised possibility of subpoena if President Trump declines to talk to investigators in the Russia probe – Washington Post
(US) White House Trade Adviser Navarro: every country granted an exemption from the steel and aluminum tariffs would still face an import quota and other restrictions – press
(US) Crop Tour said to project Northern Kansas Wheat yield at 38.2 BU/acre v 43.0 y/y – US financial press
(US) Weekly API Oil Inventories: Crude: +3.4M v +1.1M prior

Europe

(UK) Prime Min May reportedly may endorse hybrid customs partnership – FT; Also PM May has been warned her government will “collapse” if she does not abandon plans for a post-Brexit customs partnership with the EU.
(EU) EU plans to raise budget contribution to 1.14% of economic output – German press
(TR) S&P cuts Turkey sovereign rating one notch to BB- from BB; outlook to Stable from Negative

Levels as of 02:00ET

Hang Seng -0.7%; Shanghai Composite -0.4%; Kospi -0.5%
Equity Futures: S&P500 -0.1%; Nasdaq100 +0.2%, Dax +0.2%; FTSE100 -0.1%
EUR 1.2011-1.1987; JPY 109.92-109.65; AUD 0.7507-0.7475;NZD 0.7026-0.6992
Jun Gold +0.3% at $1,310/oz; Jun Crude Oil +0.5% at $67.55/brl; Jul Copper +0.8% at $3.07/lb