Asian Market Update: Strong Intel, CSX Earnings Fail to Reverse US Selloff in Asia; China Q1 GDP Rumored in 6.0-6.8% range v Consensus 6.2% Ahead of Official Report Tomorrow; Electronics Lead Decliners in Tokyo on Higher Yen, Poor US Retail Data; South Korea Loses 195K Jobs in March, 2009 Exports Target Cut; Sterling Outperforms Regional Majors as UK Housing Improves

- Asian equity markets are down across the board, tracking renewed pessimism seen in today's Wall Street session. Sharp decline in US retail sales set the downward trading trajectory early, and neither statements by President Obama crafted to elucidate administration's progress on addressing the recession nor a quest to enhance Fed transparency communicated by Chairman Bernanke could reverse hints of a protracted profit-taking from runaway rally. After 1.5%-2.0% loss in US session on Tuesday, front-month S&P futures are pointing to another lower open with a 0.7% slide, all despite strong results from tech bellwether Intel and rail shipper CSX. In Asia, Nikkei225 is trading down to session lows coming out of mid-day break, falling over 1.5%. Korea's Kospi was off by over 2%, while S&P/ASX reversed its mid-session recovery, declining 0.2%.

- Economic calendar was extremely light in the session, largely limited to March employment data from South Korea that saw jobless rate rise 2 ticks to 3.7%, with 195K jobs reported lost on a y/y basis. A barrage of economic reports from China is set for the spotlight in tomorrow's session however, with Q1 GDP joined by monthly figures on retail sales, CPI, and industrial production.
Ahead of the release, Chinese press leaked an unconfirmed report without citing sources that Q1 GDP would be above 6.0% but lower than the 6.8% figure seen in Q4. Consensus estimates point to 6.2% Q1 target, as China continues to struggle in meeting the official 8.0% GDP bar set for 2009.
Chinese commerce ministry officials also weighed in on recent US allegations of steel dumping, noting that legal action is detrimental to bilateral trade while assuaging markets that growth in forex reserves will not be impacted by the brewing conflict.

- In Tokyo, financial and tech names remained at the forefront of the selloff, where they were joined by consumer electronics sliding on poor US retail sales figures and a rally in Japanese Yen. Coming out of mid-day break, Sony, Sharp, and Hitachi were down over 3%, while Toshiba fell over 5%. In other notable Nikkei decliners, Komatsu was down 4.5% after announcing it would close two domestic plants resulting in impairment charges of ¥6.5B and Mazda fell over 2% on a cut at Deutsche. Elpida rallied over 7.5% on press speculation that the government would provide funding to the company to assist with Taiwan partnership, but reversed those gains on official repudiation of those rumors.

- In Sydney, Rio Tinto was among the early gainers after the company confirmed pricing of $3.5B in 5 and 10-yr bonds, while also noting that the debt raise is not meant to be interpreted as initiated "plan B" to the Chinalco deal, maintaining its continued commitment to China partnership. Qantas Airways extended its decline after yesterday's FY09 profit estimate cut however, falling over 3% on S&P downgrade and CEO announcement that the company is not seeking buyers. RBA Head of Financial Stability spoke, commenting on few Australians facing the prospects of negative equity in home loans as monetary authorities stood ready to act further in the event continued housing price decline.

- Elsewhere in Asia, Korea's Hynix was rumored to be facing a 31.9% stake sale by company creditors taking place as early as May. South Korea's Economy Ministry had also cut 2009 exports growth target to -13.5% from +1.1%, even though the deeper cut in imports was said to result in a wider 2009 trade surplus target of $15B-$20B. In Singapore, February retail sales rose 10.5% on a monthly basis helping SGD to a modest boost. Malaysia Central Bank Governor Zeti saw economic conditions improving in the 2nd half of the year, attributing growth in domestic demand to effectiveness of the stimulus response.

- In currencies, Japanese Yen retained its bullish tone on as risk aversion continued to play out in equities. USD/JPY fell below 98.20, EUR/JPY tested psychological 130 handle, and GBP/JPY briefly approached prior week's low just under 146. In European majors, the dollar was modestly stronger, with Euro decline outshining that of the Sterling. EUR/GBP earlier fell below 0.8890, the lowest level since March 6th after the strongest house price balance since Feb of 2008 seen in March UK RICS data. In commodity FX, AUD and NZD were each down over 60 pips against the dollar, reaching 0.7150's and 0.5750's respectively amid ongoing profit taking from the recently outperforming currency class.

- At the time of writing, crude oil prices are lower by more than 0.10%, after prices declined by more than 1% during the NY floor session. The NY losses for crude, tracked the decline in US equities. Following the US close, API disclosed that during the prior week, crude and distillate inventories were higher than expected, while gasoline supplies were lower than expected (API PETROLEUM INVENTORIES: CRUDE: +6.5M V +2.1ME; GASOLINE: -613K V -500KE; DISTILLATE: +87K V -1ME).
Upcoming event risks for crude include the Department of Energy's weekly inventories report, which will be released later on today, and China's Q1 GDP figures which are due on tomorrow's session.
Spot Gold is currently higher on today's session, tracking the declines in financial stocks. In terms of potential upcoming event risks for gold, later on today the US CPI figures for March will be released in addition to the Fed's Beige Book and Feb total net TIC flows data.