Equity indices trade mixed after US declines, HK impacted by weather conditions

Asia Market Update: Equity indices trade mixed after US declines, HK impacted by weather conditions; CN trade surplus above ests, components were mixed; US CPI due later today, corporate earnings also in focus.

General trend

- USD index trades slightly lower in Asia ahead of CPI data.

- Equity markets are generally off of the lows.

- US equity FUTS have remained modestly lower amid the Apple news.

- Nikkei has pared decline; Fast Retailing (largest Nikkei component) to report after the market close on Thurs.

- S&P ASX 200 has seen slight losses.

- Hang Seng index closed on session due to weather conditions, Thursday is also a holiday in HK.

- Shanghai Composite ended morning trading slightly lower (-0.4%); Property index dropped >1.5%.

- Chinese coal FUTs erase gain after hitting record high.

- China Sept inflation data is due on Thursday (Oct 14th).

- Monetary Authority of Singapore (MAS) is due to hold policy meeting on Thurs., Q3 advance GDP also due.

- Australia Sept jobs report also due tomorrow.

- Companies due to report during the NY morning include BlackRock, Delta, Infosys, JPMorgan.

Headlines/Economic data

Australia/New Zealand

- ASX 200 opened flat.

- (AU) Australia Oct Westpac Consumer Confidence: 104.6 v 106.2 prior; M/M: -1.5% v +2.0% prior.

- (AU) Australia Sept HIA New Home Sales M/M: 2.3% v 5.8% prior.

- (AU) Australia Treasurer Frydenberg: Expects GDP contraction of 3% of more in Q3; Companies and households have built up A$250M on balance sheets; open to review of RBA, there is a case there for having a review of the RBA.

- (AU) Australia sells A$1.0B v A$1.0B indicated in 1.25% May 2032 bonds, avg yield 1.7305%, bid to cover 5.90x.

- (NZ) New Zealand Sept ANZ Business Confidence: -8.6 v -3.8 prior; Activity Outlook: 26.2 v 19.2 prior.

- (NZ) Reserve Bank of New Zealand (RBNZ) Bascand: To give speech at Citi conference on Oct 13th; the speech is titled "The contribution of strong balance sheets to NZ's economic resilience and recovery from the pandemic".

- (NZ) New Zealand Sept Food Prices M/M: 0.5% v 0.3% prior.

China/Hong Kong

- Hang Seng closed due to weather conditions, Shanghai Composite opened -0.1%.

- (CN) CHINA SEPT TRADE BALANCE: $66.8B V $46.6BE; Exports Y/Y: 28.1% v 21.5%e; Imports Y/Y: 17.6% v 20.7%e.

- (HK) Hong Kong Typhoon warning Signal 8 to remain in effect until 16:00 local time (end of afternoon trading session) [Earlier today Hong Kong Exchange said: if the typhoon warning is at 8 or above (or extreme weather conditions are announced) and remains issued at 12 noon, all trading sessions today will be cancelled].

- (CN) China Energy Administration: Sept Power Consumption Y/Y: 6.8% v 3.6% prior.

- (CN) China Industry Min (MIIT): Has asked steel mills in certain cities to cut steel production from Nov 15 to Mar 15 2022.

- (CN) China Real Estate Association said to be planning meeting with builders over difficulties and risks; to hold a symposium with property developers in Beijing Friday, Oct 15th to implement property industry policies – press.

- (CN) China Sec Journal: Property Market may cool down further during Q4 due to additional regulations.

- IMF: Cuts China 2021 GDP growth forecast from 8.1% to 8.0%; Cuts China 2022 GDP growth forecast from 5.7% to 4.9%.

- (CN) China PBOC Open Market Operation (OMO): Injects CNY10B in 7-day reverse repos v CNY10B prior; Net drain CNY90B v Net drain CNY90B prior.

- (CN) China PBOC sets Yuan reference rate: 6.4612 v 6.4447 prior.

- (CN) China MOF to sell an additional CNY6.0B worth of Dim Sum bonds in Hong Kong on Oct 20th (Wed).

- (TW) Taiwan Defense Ministry: Warns that will issue tougher response to China if military jet flights get too close.

Japan

- Nikkei 225 opened -0.5%.

- (JP) Japan PM Kishida: Must be cautious on issuing perpetual bonds for Govt funding, need to ensure market trust; No comment on recent FX Development.

- (JP) Japan PM Kishida: Must deploy fiscal stimulus flexibly but does not suggest any problem with raising debt balance indefinitely; Must avoid the possibility of any emerging JGB default risk - parliament comments [from Oct 12th’].

- (JP) Japan Sept M2 Money Supply Y/Y: 4.2% v 4.3%e; M3 Money Supply Y/Y: 3.8% v 3.9%e.

- *(JP) JAPAN AUG CORE MACHINE ORDERS M/M: -2.4% V +1.4%E; Y/Y: +17.0% V 13.9%E.

Korea

- Kospi opened -0.1%.

- (KR) South Korea Aug Unemployment Rate: 3.0% v 3.0%e.

- (KR) South Korea sells 2-year bonds: avg yield 1.650% v 1.320% prior.

- (KR) South Korea Sept Total Bank Lending to Households (KRW): 1,053T v 1,046T prior.

North America

-  Apple [AAPL]: now said to expect production of new iPhones in the last three months of 2021 to be as much as 10M units lower than its original plan for 90M units – press.

- (US) Fed's Quarles to no longer be chair of Supervision and Regulation committee when term expires tomorrow (Oct 13th), committee to meet on unchaired basis.

- (US) Fed's Barkin (FOMC voter, hawk): Reiterates prices are being pushed higher by shortages.

- (US) Debt limit increase bill through Dec 3rd has passed in the House of Representatives, the final vote was 219-206; White House has previously said that President Biden will sign the bill.

- (US) US to allow vaccinated Canadians and Mexicans to enter county in early Nov - Press.

Europe

- LVMH [MC.FR]: Reports Q3 Rev €15.5B v €15.0Be; Sees continuation of current growth.

- SAP [SAP.DE]: Raises FY21 Cloud Rev €9.4-9.6B, op profit €8.1-8.3B (prior Cloud Rev €9.3-9.5B, op profit €7.95-8.25B).

Levels as of 01:20 ET

- Nikkei 225, -0.1%, ASX 200 -0.1% , Hang Seng closed; Shanghai Composite +0.1% ; Kospi +1%.

- Equity S&P500 Futures: flat; Nasdaq100 -0.1%, Dax +0.2%; FTSE100 flat.

- EUR 1.1555-1.1528 ; JPY 113.62-113.34 ; AUD 0.7353-0.7328 ;NZD 0.6949-0.6921.

- Gold +0.1% at $1,761/oz; Crude Oil -0.1% at $80.56/brl; Copper +0.4% at $4.3405/lb.