Asian equities trade mostly higher ahead of China GDP data
|Asia Market Update: Asian equities trade mostly higher ahead of China GDP data; Aussie declines after RBA minutes
General Trend:
- Rio Tinto declines despite cutting iron ore shipments forecast, some analysts focus on impact of higher product prices
- Japanese telecom sector outperforms; Docomo specified its plans to cut mobile phone rates
- Financials in China continue to gain after better March lending data, PBOC resumed OMOs
- China property index under performs as new home prices accelerate
- Various companies comment on market outlook at Shanghai auto show
- China HNA affiliate fails to meet interest payment, triggers cross default
- PBoC Quarterly Monetary Policy Statement: Expectations of financial market has improved, to control spigot of money supply (follows better than expected March lending data)
- PBoC resumed OMO for the first time in 19 sessions, injected liquidity
- China Q1 GDP data due for release on Wed (April 17th), some analysts are looking for signs of whether growth has bottomed
- Chinese bond yields rise ahead of the Wed data
- RBA Minutes: Discussed scenario where rate cut would be appropriate, forward indicators of labor demand mixed in recent months.
- Japan Fin Min Aso: No comment on currency clause (refers to US/Japan trade talks)
- BoJ Gov Kuroda commented on regional bank tie-ups
- RBNZ Gov: Q1 CPI undershooting forecast is already factored into dovish bias (comments ahead of April 17th Q1 CPI data)
- Taiwan chipmaker Nanya expected to report earnings later today
- US companies expected to report corporate earnings on Tuesday include Bank of America, BlackRock, JNJ and UnitedHealth
Headlines/Economic Data
Australia/New Zealand
-ASX 200 opened -0.1%
-RIO.AU Reports Q1 Pilbara iron ore shipments 69.1Mt v Mte v 80.3Mt y/y; Pilbara iron production 76.0Mt v 80.0Mte v 83.1Mt y/y; Cuts Pilbara shipments 333-343Mt (prior 338-350Mt)
- (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence: 115.3 v 113.2 prior
- (AU) RESERVE BANK OF AUSTRALIA (RBA) APR MINUTES: REITERATES NOT A STRONG CASE FOR NEAR TERM ADJUSTMENT IN RATES
- (NZ) RBNZ Gov Orr: Monetary easing bias remains in place for now; Q1 CPI undershooting forecast is already factored into dovish bias; NZD is currently around its happy place
Japan
-Nikkei 225 opened -0.3%
- (CN) China and Japan to start listing each other's ETFs, could start as soon as May – Nikkei
- (JP) Japan Finance Min Aso: Expect BOJ to continue efforts for price target; 2% target is important for Govt
- (JP) Japan Trade Min Motegi: Held first trade talks with Lighthizer, spirit of talks was in line with Sept agreement
- 9437.JP Cuts mobile phone rates by up to 40%; Effective Jun 15
- (JP) Bank of Japan (BOJ) Gov Kuroda: Inflation has been weak given tight job market – parliament
- (JP) Japan Finance Min Aso: No comment on currency clause [US Treasury Sec Mnuchin is said to have called for a currency clause to be included in a trade deal with Japan]
-(JP) Japan MoF sells ¥1.0T v ¥1.0T indicated in 0.40% (prior 0.50%) 20-yr bonds; avg yield 0.366% v 0.419% prior; bid to cover 5.10x v 4.67x prior
Korea
- Kospi opened -0.1%
- KR) Size of South Korea's extra budget to be decided during week of Apr 22nd – press
- (KR) US Sec of State Pompeo: The next summit between North Korea Kim and President Trump may happen this year
- (KR) President Trump: North Korea talks are moving along "perfectly"
China/Hong Kong
-Hang Seng opened -0.2%; Shanghai Composite opened -0.4%
- (CN) China PBoC Open Market (OMO): Injects CNY40B in 7-day reverse repos v skips prior; Net: CNY40B injection v nil prior (first operation after 18 consecutive skips)
- (CN) China PBoC sets yuan reference rate: 6.7097 v 6.7112 prior
- (CN) China PBoC Quarterly Monetary Policy Statement: To strike balance in the prudent monetary policy; calls for further unclogging of policy transmission (after the close)
- (CN) CHINA MAR NEW HOME PRICES M/M: 0.6% V 0.5% PRIOR; Y/Y: 10.6% V 10.4% PRIOR
North America
- (US) Fed’s Rosengren (moderate, voter): Fed is waiting to see evidence that inflation will reach 2% target; unemployment falling, doesn't expect recession; Balance sheet asset allocation will be topic in future FOMC discussions
Europe
- BMW.DE CFO: Sees 2019 China sales growth 5-10% y/y - speaking at Shanghai Motor Show
Levels as of 1:20 ET
- Nikkei 225, +0.3%, ASX 200 +0.4%, Hang Seng +0.6%; Shanghai Composite +1.1%; Kospi +0.1%
- Equity Futures: S&P500 +0.1%; Nasdaq100 +0.2%, Dax +0.2%; FTSE100 +0.2%
- EUR 1.1314-1.1292; JPY 112.05-111.88; AUD 0.7176-0.7139 ;NZD 0.6770-0.6741
- Gold -0.2% at $1,288/oz; Crude Oil -0.1% at $63.36/brl; Copper flat at $2.933/lb
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