Rates And Oil Prices Also Remain In Focus

May 18 18, 07:16 GMT

General Trend:

Energy companies outperform, Financials trade generally lower
Airlines generally weighed down by rise in oil prices
Canadian Dollar and Mexican Peso decline as US Trade official continued to make cautious comments on possibility of near-term NAFTA agreement
Reportedly China trade delegation offers package to reduce US trade deficit by $200B annually, said a press report; yet to be confirmed by US or China officials
China to end dumping probe related to US Sorghum; US Corn, Wheat and Soybean Futures rise
US/China talks to continue on Friday
Japan CPI slows for 2nd straight month
US Treasury yields extend gains during Asian session; Asian 10-yr yields move generally higher
Australia 3-month bank bill rate rises for second straight session
China sold 50-year bonds at a lower than expected yield
China local government firm in Inner Mongolia said to fail to pay interest and principal on approx. CNY4.0B in loans – Chinese Press
Indonesia Rupiah (IDR) declines after rate hike
Indonesia Central Bank: “Is in the market” to smoothen Rupiah currency (IDR) volatility

Headlines/Economic Data

Australia/New Zealand

ASX 200 opened +0.3%; closed -0.1%
ASX 200 Resources index -0.8%, Telecom -0.6%, Financials -0.5%, Utilities -0.5%; Energy +0.8%, REIT +0.8%

China/Hong Kong

Shanghai Composite opened -0.1%, Hang Seng +0.3%
Hang Seng Energy index +3.6%, Property/Construction +0.7%, Materials +0.7%, Info Tech +0.4%; Industrial Goods -0.5%, Telecom -0.4%, Financials -0.2%
(CN) Reportedly China trade delegation offers package to reduce US trade deficit by $200B annually – press
(CN) China Commerce Ministry (MOFCOM): to end dumping probe related to US Sorghum; cites ‘public interest’
(US) US President Trump: Important to keep trade cooperation with China; Both countries should expand agricultural cooperation
(CN) China Vice Premier Liu He comments after meeting with Trump: China willing to work with US on trade issue
(CN) Taiyuan City in China said to tighten controls related to home purchases – US financial press
(CN) Shanghai Stock Exchange said to scrutinize share-backed loans by controlling shareholders – financial press
(CN) China PBoC Open Market Operation (OMO): Skips OMO v CNY50B injected in 7-day and 14-day reverse repos prior
(CN) China PBoC sets yuan reference rate at 6.3763 v 6.3679 prior
(CN) China Finance Ministry (MOF) sells 50-year bonds: avg yield 4.13% v 4.22%e; bid to cover 2.24x

Japan

Nikkei 225 opened +0.3%; closed +0.4%
TOPIX Marine Transportation index +1.4%; Real Estate -0.4%, Securities +0.3%, Iron & Steel -0.3%
(JP) JAPAN APR NATIONAL CPI Y/Y: 0.6% V 0.7%E; CPI EX FRESH FOOD (CORE): 0.7% V 0.8%E (lowest core reading since Sept 2017)

Korea

Kospi opened +0.5%
(KR) North Korea state media: N Korea to makes more efforts to defuse military tensions

North America

US equity markets ended mixed: Dow Jones -0.2%, S&P500 -0.1%, Nasdaq -0.2%, Russell 2000 +0.5%
S&P500 Energy +1.5%; Real Estate -0.5%, Technology -0.5%
(US) Pres Trump: doubts China trade talks will be successful
(US) US Trade Rep Lightizer: NAFTA countries are no where near close to a deal; will continue to engage in negotiations

Europe

(EU) EU reportedly brushes off Prime Min May’s idea for customs plan guarantees – press
(UK) UK reportedly establishes government team to deal with post-Brexit borders – press
(EU) ECB’s Nowotny (Austria): some other governing council members agree that ECB should not wait too long to normalize monetary policy
(ECB) ECB Nominee Rehn said jury is still out on extent of slowdown – US financial press
Saudi and UAE Oil Min joint statement: see ample supply of oil; have concerns about recent oil market volatility; Plan meeting with Russia Oil Min Novak next week
Vivendi [VIV.FR]: Reports Q1 Rev €3.11B v €2.68B y/y

Levels as of 02:00ET

Hang Seng +0.3%; Shanghai Composite +0.1%; Kospi +0.4%
Equity Futures: S&P500 +0.2%; Nasdaq100 +0.3%, Dax +0.2%; FTSE100 flat
EUR 1.1788-1.1809 ; JPY 110.71-111.02 ; AUD 0.7503-0.7520 ;NZD 0.6873-0.6897
Jun Gold -0.1% at $1,288/oz; Jun Crude Oil +0.2% at $71.62/brl; Jul Copper +0.1% at $3.086/lb