Asian equity markets open broadly higher after mixed US session
|Asia Market Update: Asian equity markets open broadly higher after mixed US session; Chinese officials take action on Anbang Insurance
Headlines/Economic Data
General Trend:
-Japan Jan Core CPI holds steady, while headline inflation hits highest level since March 2015 (highest since July 2014 excluding impact of sales tax hike)
-China takes temporary control of Anbang Insurance
-China said to speak with banks about support for conglomerate HNA Group
-Kiwi (NZD) under performs
- South Korea confirms to resume sales of 50-year bonds
Australia/New Zealand
-ASX 200 opened +0.4%; closed +0.8%
-ASX 200 Resources Index +1.6%, REIT +1.2%, Financials +0.6%
-(AU) Australia sells A$400M v A$400M in May 2021 bonds, avg yield 2.1289% , bid to cover 6.12x
- (NZ) New Zealand Q4 Retail Sales (Ex Inflation) Q/Q: 1.7% v 1.4%e
- (AU) Fitch affirms Australia 4 major banks (Commonwealth Bank, ANZ, NAB, Westpac)
- (AU) Australia Deputy PM Joyce resigns as leader of National Party, remains in parliament
China/Hong Kong
-Shanghai Composite opened +0.2%, Hang Seng opened +1%
- Hang Seng Property/Construction Index +1.3%, Energy+1.1%, Materials +1%, Services +1%, Info Tech +0.9%, Financials +0.9%
- Shanghai Property index rises over 2% then pares gain
-Aluminum producer Rusal [486.HK] declines over 1% as Q4 adj EBITDA missed estimates
-(CN) China regulators take over Anbang Insurance for 1-year from Feb 23rd; company to'remain private' - US financial press
-(CN) China to notify banks about supporting HNA Group - US financial press
-(CN) China revises Jan Trade Surplus higher to $20.35B v $20.34B prelim; US dollar (USD) denominated imports revised to +36.8%v +36.9% prelim – Customs
-(CN) PBOC SETS YUAN REFERENCE RATE AT 6.3482 V 6.3530 PRIOR
-(CN) China PBoC OMO: Injects CNY230B v CNY350B injected in 7-day, 28-day and 63-day reverse repos prior
Japan
-Nikkei 225 opened +0.3%: closed +0.7%
-TOPIX Iron & Steel Index +1.8%, Real Estate+1.5%, Securities +1.5%
- JAPAN JAN NATIONAL CPI Y/Y: 1.4% V 1.3%E(Highest since March 2015*); CPI EX-FRESH FOOD (CORE) Y/Y: 0.9% V 0.8%E[*Note: According to Japan government data, the overall Jan CPI rose at the fastest pace since July 2014 (ex impact of sales tax hike)]
- Japan Finance Min Aso: Want to raise nationwide sales tax as scheduled in Oct 2019; Reiterates important for BoJ to maintain current policy framework
Korea
-Kospi opened +0.5%
-Samsung Electronics [005930.KR]: To spend $6.0B by 2020 to expand Hwaseong chip plant, could expand investment after the production line begins operations
-South Korea Vice Finance Min: To resume sale of 50-year Treasury bonds in mid-March; the specific date and amount has not been set as of yet
-South Korea Q4 Short-term External Debt:$115.9B v $118.9B prior
- US said to announce new sanctions on North Korea on Friday - financial press
Other Asia
-(SG) Singapore Jan CPI M/M: -0.2% v +0.2%e; Y/Y: 0.0% v 0.4%e; CPI Core Y/Y: 1.4% v 1.5%e
NorthAmerica
-US equity markets ended mixed: Dow +0.7%,S&P500 +0.1%, Nasdaq -0.1%, Russell 2000 -0.1%
-S&P500 Energy +1.1%, Real Estate +1.1%; Financials -0.8%
-(US) Fed's Bullard (dove, non-voter): Not behind view for 4 rate hikes in 2018 "unless everything goes perfect"; idea that rates have to rise 100bp in 2018 "seems like a lot to me."– CNBC
-(US) Fed's Kaplan (non-voter, dove): Still believes three 2018 hikes is a good base case
-(US) Fed's Bostic (2018 voter, dove): Fed is carefully calibrating a return to more normal policy - comments in Atlanta
-(US) Fed's Dudley (dove, FOMC voter): Does not comment on monetary policy in prepared remarks
-(US) NY Fed Jan primary dealer survey: median dealer saw 3 hikes in 2018 before Jan FOMC meeting
-(US) TREASURY $28B 7-YEAR NOTE AUCTION RESULTS:DRAWS 2.839% (highest yield since March 2011); BID-TO-COVER: 2.49 V 2.73 PRIOR AND 2.54 AVG OVER LAST 12 AUCTIONS (lowest BTC since Nov 2017)
-(US) US Treasury Sec Mnuchin: President Trump's policies will raise wages without inflation
-(US) US Defense Secretary Mattis: Supports Commerce Dept's actions on steel and aluminum; targeted tariffs are preferable to global quota or global tariff
(US) DOE CRUDE: -1.6M V +2ME
Europe
-(EU) ECB's Smets (Belgium):has full confidence ECB will reach inflation goal; Euro strength and volatility is not yet a concern
Levels as of 01:00ET
- Hang Seng +0.9%; Shanghai Composite +0.1%; Kospi +1.2%
- Equity Futures:S&P500 +0.3%; Nasdaq100 +0.2%, Dax +0.2%; FTSE100 +0.3%
- EUR 1.2295-1.2338 ; JPY 106.65-107.05; AUD 0.7816-0.7849 ;NZD 0.7289-0.7346
- Feb Gold -0.3% at $1,329/oz;Feb Crude Oil -0.1% at $62.70/brl; Mar Copper -0.6% at $3.217/lb
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