Equities trade mixed amid US cues and holiday impact

Asia Market Update: Equities trade mixed amid US cues and holiday impact; Aussie yields decline ahead of upcoming CPI data

General Trend:

- Nikkei weighed down by broker downgrade of Fast Retailing

- Shanghai Composite declines for 2nd straight session, markets continue to debate next RRR cut

- Shanghai Property index rises less than 1%, declined over 3.5% on Monday’s session

- Property index in Hong Kong declines due to catch-up selling

- Higher oil prices weigh on Chinese airlines

- China pork producer WH Group rises over 6% on outlook for domestic prices

- China PBOC skips OMO and drains liquidity for first time since late March

- China 10-yr bond yields extend gains amid focus on PBOC policy outlook, higher oil prices, Monday’s rise in US Treasury yields

- Analysts start to raise China growth forecasts after better March data

- Oil Futures extend gain amid focus on supplies and Iran

- Australian equities rise upon return from 2-day holiday, Energy sector out performs

- Australia Q1 CPI expected to remain below the RBA’s 2-3% target, data due on Wed

- Bank of Japan (BOJ) is due to meet April 24-25th

- US companies expected to report earnings on Tuesday include Hasbro, Harley Davidson, JetBlue, Coca-Cola, Lockheed Martin, Nucor, Procter & Gamble, PulteGroup, Polaris Industries, Sherwin Williams, State Street, Twitter, United Technologies, Verizon

 

Headlines/Economic Data

Australia/New Zealand

-ASX 200 opened +0.2%

- PDN.AU Comments on market speculation: Currently has no intention to raise capital

- (NZ) New Zealand Mar Credit Card Spending M/M: -0.1% v +0.2% prior; Y/Y: 5.1% v 6.4% prior

Japan

-Nikkei 225 opened +0.1%

- NSANY Renault said to have made new attempt to integrate with Nissan; Nissan expected to reject offer and push for more equal capital relationship - Nikkei

- (JP) Japan Trade Min: No need to use national oil reserves after US decision on Iran oil sanction

- (JP) Japan Fin Min Aso: No comment on content of talks with Mnuchin; reiterates have been no talks on currency as parties agreed

- (JP) Bank of Japan (BOJ) Senior Official Maeda: Reiterates BOJ will ease policy further if needed, if momentum for hitting price target is threatened; ready to act including combining various means

- 0003.JP Guides FY19/20 Plans to increase foreign and domestic bond holdings

-(JP) Japan MoF sells ¥2.1T v ¥2.1T indicated in 0.10% (0.10% prior) 2-yr JGBs, avg yield: -0.152% v -0.175% prior, bid to cover 5.04x v 5.28x prior

Korea

-Kospi opened +0.1%

- (KR) South Korea Government: Overnight FX swap drop is a temporary trend; attributes it to repatriation of stock dividends

- 020560.KR Creditors planning KRW1.6T capital injection – Yonhap

- 005930.KR To ship back Galaxy foldable phones that were shipped to EU and US - Korean press

China/Hong Kong

-Hang Seng opened -0.6%; Shanghai Composite opened -0.1%

- (CN) China Central Financial and Economic Affairs Committee reiterates plan to increase financial support for real economy; to fine tune monetary policy on growth and prices

- (CN) According to some domestic Canton Fair exhibitors, China belt and road plan helping foreign firms and hurting mainland exporters – SCMP

- (CN) China to issue guidelines related to steel industry M&A - Chinese Press

- (CN) China PBoC Open Market Operation (OMO): Skips reverse repo operations for the second consecutive session; Net: CNY40B drain v CNY0B prior (first drain since late March)

- (CN) China PBoC sets yuan reference rate: 6.7082 v 6.7035 prior

- (CN) Fitch Report: Sees China Property sales will be at lower end of 5-10% forecast in Nov 2018

- 700.HK According to analysts, China's new requirement for mini and HTML5 games to go through regulatory approval before release may reduce overall game approvals and reduce usage of WeChat

- (CN) Certain shipments of Canada pork to China said to have been delayed due to paperwork issue - financial press

- (CN) China Ministry of Agriculture and Rural Affairs 2019-2028 outlook: see pork prices rising, grain production to remain stable - 2019 China Agricultural Outlook Conference

-(CN) China former Commerce Min: Expects imports to grow faster than exports - Chinese press

Other Asia

- (SG) Singapore Mar CPI M/M: -0.1% v +0.1%e; Y/Y: 0.6% v 0.7%e; CPI Core Y/Y: 1.4% v 1.7%e

- (PH) Philippines Central Bank suspends currency trading and bond auctions until impact of recent 6.1 magnitude earthquake is assessed

North America

- (IR) US Sec of State Pompeo: Trump administration will no longer grant exemptions on waivers for Iran oil sanctions; we are confident oil market to remain stable

- (MX) Mexico Foreign Ministry: Slowing flow of goods and transit of people at US border is detrimental for both economies and competitiveness of region

Europe

- (UK) 1922 Committee of Conservative MPs (back benchers) Chair Brady said to have prepared to tell PM May that she must step down by the end of June or her MPs will change the Tory party leadership rules to force her out - financial press

- (UK) US Pres Trump to visit United Kingdom in June - UK Press

-(FR) ECB's Coeure (France) Negative interest rates are not the biggest problem for the banking sector; Sector should focus on costs; growth will return in H2 this year, if we see solutions to the trade conflict - financial press

 

Levels as of 1:20 ET

- Nikkei 225, -0.1%, ASX 200 %, Hang Seng -0.1%; Shanghai Composite -0.4%; Kospi flat

- Equity Futures: S&P500 flat; Nasdaq100 +0.1%%, Dax -0.1%; FTSE100 +0.3%

- EUR 1.1262-1.1244; JPY 111.98-111.65 ; AUD 0.7153-0.7121 ;NZD 0.6688-0.6670

- Gold flat at $1,277/oz; Crude Oil +0.5% at $65.86/brl; Copper +0.3% at $2.913/lb