TradeTheNews.com Staff
TradeTheNews.com
Notes/Observations
- Bank of Korea (BOK) left its 7-day Repo Rate unchanged at 2.25% (as expected) but one member sought another rate cut
- China Aug liquidity data misses targets but PBoC official downplays need for large-scale stimulus as overall market liquidity remained relatively ample (Aug New Yuan Loans (CNY) 702.5B v 700.0Be ; Aggregate Financing (CNY): 0.96T v 1.20Te; Aug M2 Money Supply Y/Y: 12.8% v 13.5%e)
- Euro Zone finance ministers meet today; France and Germany expected to present their plans for a new investment initiative
Key Economic Data in session***
- (JP) Japan July Final Industrial Production M/M: 0.4% v 0.2% prelim; Y/Y: -0.7% v -0.9% prelim; Capacity Utilization M/M: -0.8% v-3.3% prelim
- (UK) Retailer John Lewis reports weekly LFL Partnership sales for week ending Sept 5th: +6.6% v +9.5% prio
- (DE) Germany Aug Wholesale Price Index M/M: -0.2 v +0.1% prior; Y/Y: -0.6 v -0.7% prior
- (FI) Finland July Final Retail Sales Volume Y/Y: -0.5% v -0.6% prelim
- (FR) France July Current Account Balance: -€2.2B v -€7.2B prior
- (RU) Russia Narrow Money Supply w/e Sept 5th (RUB): 8.28T v 8.35T prior
- (HU) Hungary July Final Industrial Production M/M: 1.6% v 1.6% prelim; Y/Y: 12.3% v 12.3% prelim
- (ES) Spain Aug CPI M/M: 0.2% v 0.2%e; Y/Y: -0.5% v -0.5%e
- (ES) Spain Aug CPI EU Harmonized M/M: 0.1% v 0.1%e; Y/Y: -0.5% v -0.5%e
- (ES) Spain Aug CPI Core M/M: +0.1% v -1.1% prior; Y/Y: 0.0% v 0.0% prior
- (EU) ECB €174M borrowed in overnight loan facility vs. €111.0M prior; €21.4B parked in deposit facility vs. €19.6B prior - Daily Eurosystem Liquidity Conditions
- (IT) Italy July Industrial Production M/M: -1.0% v -0.2%e; Y/Y: -1.8 v 0.3% prior; Industrial Production WDA Y/Y: -1.9% v +0.1%e
- (CN) Shanghai Futures Exchange (SHFE) Weekly Copper Stockpiles: 75.0K v 74.3K prior
- (IT) Italy July General Government Debt: €2.169T v €2.168.4T prior (record high)
-(UK) July Construction Output M/M: 0.0% v 0.6%e; Y/Y: 2.6% v 3.2%e
- (HK) Hong Kong Q2 Industrial Production Y/Y: 2.2% v 2.1% prior
- (HK) Hong Kong Q2 PPI Y/Y: -0.4% v -6.2% prior
- (EU) Euro Zone July Industrial Production M/M: 1.0% v 0.7%e; Y/Y: 2.2% v 1.4%e
- (EU) Euro Zone Q2 Employment Q/Q: 0.2% v 0.1% prior; Y/Y: 0.4 v 0.1% prior
- (IT) Italy Aug Final CPI M/M: 0.2% v 0.2% prelim; Y/Y: -0.1% prelim; CPI Ex Tobacco: 107.5 v 107.3 prior
- (IT) Italy Aug Final CPI EU Harmonized M/M: -0.2% v -0.2% prelim; Y/Y: -0.2% v -0.2% prelim
Fixed Income
- None seen
SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM
***Equities***
Indices [Stoxx50 -0.1%, FTSE 100 +0.1% at 6,807, DAX -0.3% at 9,667, CAC-40 -0.2% at 4,432, IBEX-35 flat at 10,894, FTSE MIB flat at 21,091, SMI -0.5% at 8,787, S&P 500 Futures flat at 1,988]
- Market Focal Points/Key Themes: Equity markets open slightly higher then pare gains (next week's Fed meeting, Scottish referendum in focus), Aveva weighed down by profit warning, Shares of E.ON supported by broker commentary , Gold miner Fresnillo considers hedging some of its precious metals production
By Sector
-Utilities [E.ON EOAN.DE +1.5% (broker commentary); RWE.DE -1% (cautious broker commentary)]
- Technology [Aveva AVV.UK -19% (profit warning)]
- Healthcare [Novo Nordisk NOVOB.DK +2% (FDA decision on SAXENDA)]
- Consumer Discretionary [Boohoo BOO.UK +7% (H1 Rev +31%); Gerry Weber GWI1.DE -6% (Q3 profits declined)]
- Financials [Barclays BARC.UK +1% (new Chairman)]
- Stoxx50 sectors [Energy -0.5%, Telecom -0.3%, Consumer Cyclical -0.2%, Financials -0.1%, Utilities -0.1%, Industrials -0.1%; Technology +0.4%, Basic Materials +0.3%, Consumer Non-Cyclical flat]
Speakers
- Eurogroup chief Dijsselboem welcomed the ECB measures to purchase ABS securities noting that the; efforts weare accommodative for recovery. Needed to see how Europe could support the ECB's efforts and added that many countries needed structural reforms. EU to take into account budget pact flexibility and would assess the French budget performance
- German Fin Min Schaeuble noted that the Financial Transaction Tax (Tobin tax) to begin in small steps
- Italy Fin Min Padoan stated that the govt would respect the 3.0% budget deficit to GDP target but added the 2.6% deficit target for 2014 was based on old macro forecasts.There was convergence of EU govt on need for investment and an agreement on growth and jobs as top priorities after focus for years was on consolidation and banking union. He did not comment on need for budget adjustment for 2014
- Ukraine President Poroshenko stated that it lost Crimea due to an invasion bit vowed to get it back as living standards rise. He noted that EU had demonstrated unity and solidarity for Ukraine and it would ratify the EU association agreement on Tuesday, Sept 16th. He also hoped for special status from NATO
Currencies/Fixed Income:
- Yield-driven USD strength paused at week's end. The EUR/USD was steady at 1.2928 just ahead of the NY morning while USD/JPY retreated from frsh 6-year highs of 107.40.
- The GBP/USD could not find the strength to rally despite another UK poll showing the "No" vote regaining the upper hand at the upcoming Scottish Referendum.
Political/In the Papers:
- (UK) YouGov poll on Scotland independence referendum: 48% Yes, 52% No (Sept 7th, prior YouGov 51% yes, 49% no)
- (EU) ECB's Draghi: Governing council prepared to take new measures if needed in order to meet price stability mandate - comments from Milan
- (EU) ECB's Constancio: Risks that longer term inflation expectations could become unanchored have increased significantly; we are not in deflation; QE was discussed at most recent meeting; cannot exclude the purchase of Govt bonds
- (EU) ECB's Coeure (France): ECB is not becoming a bad bank; public guarantees are not needed for ABS buying plan, targeted guarantees can be useful for supporting broader markets
- (EU) ECB's Liikanen: Reiterates view interest rates at lower limit; ECB does not exclude other options
- (EU) Germany dep Fin Min Meister: Unclear why ECB appears to be weakening the Euro
- (AU) Australia PM Abbott raises terror threat level to "high" (as speculated)
Looking Ahead
All times listed for economic events are denominated in Eastern Standard Time (Add 4 hours for GMT equivalent)
- (GR) Greece Sovereign Debt Rating published by S&P
- (IE) Ireland Sovereign Debt Rating might be published by Moody's
- (CH) Swiss Government holds Weekly Meeting
- (UR) EU, Ukraine, Russia meet on EU-Ukraine Trade Deal in Brussels
- (EU) ECB chief Draghi with member Constancio (Portugal) at Eurogroup and EcoFin meeting
- 05:30 (RU) Russia Central Bank (CBR) Interest Rate Decision: Expected to leave One-Week Auction Rate unchanged at 8.00%
- 05:30 (ZA) South Africa to sell I/L Bonds
- 06:00 (EU) ECB announces 3-Year LTRO Repayment vs. €4.0Be
- 06:05 (UK) DMO to sell combined £6.0B in 1-month, 3-month and 6-month Bills
- 06:45 (US) Daily Libor Fixing
- 07:00 (FR) ECB's Couere (France) in Milan
- 07:30 (BR) Brazil July Economic Activity Index M/M: +0.8%e v -1.5% prior; Y/Y: -1.0%e v -2.2% prior
- 07:30 (IN) India Forex Reserves w/e Sept 5th: No est v $318.6B prior
- 08:00 (IN) India Aug CPI Y/Y: 7.8%e v 8.0% prior
- 08:00 (IN) India July Industrial Production Y/Y: 1.9%e v 3.4% prior
- 08:00 (IS) Iceland Aug Unemployment Rate: No est v 3.1% prior
- 08:00 (PL) Poland Aug M3 Money Supply M/M: 0.7%e v 0.7% prior; y/Y: 6.3%e v 6.2% prior
- 08:00 (ES) Spain Debt Agency (Tesoro) announces specific bonds to be issued in upcoming auction
- 08:15 Baltic Dry Bulk Index
- 08:30 (US) Aug Advance Retail Sales M/M: 0.6%e v 0.0% prior; Retail Sales Ex Auto M/M: 0.2%e v 0.1% prior; Retail Sales Ex Auto and Gas: 0.5%e v 0.1% prior; Retail Sales Control Group: 0.5%e v 0.1% prior
- 08:30 (US) Aug Import Price Index M/M: -1.0%e v -0.2% prior; Y/Y: -0.4%e v +0.8% prior
- 09:00 (CA) Canada Aug Teranet/National Bank HPI M/M: No est v 1.1% prior; Y/Y: No est v 4.9% prior; House Price index: No est v 165.84 prior
- 09:30 (DE) Germany Chancellor Merkel holds CDU Election Rally at Cottbus
- 09:55 (US) Sept Preliminary University of Michigan Confidence: 83.3e v 82.5 prior
- 10:00 (US) July Business Inventories: 0.4%e v 0.4% prior
- 15:00 (AR) Argentina Aug Wholesale Price Index M/M: No est v 1.3% prior; Y/Y: No est v 27.9% prior
- (CO) Colombia Central Bank's Economists Survey
- (CO) Colombia Central Bank Monetary Policy Minutes
- (AR) Argentina Aug National Urban CPI M/M: No est v 1.4% prior
Weekend Events:
Data:
- 01:30 (CN) China Aug YTD Fixed Urban Assets Y/Y: 16.9%e v 17.0% prior
- 01:30 (CN) China Aug Retail Sales Y/Y: 12.1%e v 12.2% prior; Retail Sales YTD Y/Y: 12.2%e v 12.1% prior
- 01:30 (CN) China Aug Industrial Production Y/Y: 8.8%e v 9.0% prior; Industrial Production YTD Y/Y: 8.8%e v 8.8% prior
Events:
- (SE) Sweden national elections
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