Markets looking to US CPI and FOMC Minutes Wed night – RBNZ rate decision tomorrow
|Asia Market Update: Quieter day in Asia; NZ Bus Confidence & AU Consumer Confidence down; Korea govt joins chip wars; Markets looking to US CPI and FOMC Minutes Wed night; RBNZ rate decision tomorrow.
General trend
- After yesterday morning’s volatility, a much quieter day in Asia with little movement in FX and bonds with mixed equities throughout the region. Taiwan Semi’s new US subsidies helped Taiwan’s Taiex to fresh record highs.
- There were no clear catalysts today, with markets waiting for tomorrow night’s US CPI and FOMC Minutes.
- Australian monthly consumer confidence extends its slump to 2 years, while the Roy Morgan weekly index is down at levels more depressed than the sharp recession of 1991.
- Following on from last month’s pessimistic ANZ Business Confidence print, today’s NZIER quarterly survey showed NZ businesses are more pessimistic about the economy based on their own trading against a range of economic headwinds – particularly in the building sector.
- Kiwi dollar hit a two year high.
- South Korea joins the international chip wars with Pres Yoon announcing multi-billion dollar incentives to attract chip-makers to Korea, following Japanese and US subsidies for domestic and international semiconductor makers.
- US equity FUTs +0.1% during Asian session.
Looking ahead (Asian time zone)
- Wed Apr 10th RBNZ Interest Rate Decision, BOJ Ueda speech, (Wed night US CPI + FOMC Minutes).
- Thu Apr 11th CN Mar CPI, (Thu night ECB rate decision, US PPI).
- Fri Apr 12th CN Balance of Trade, SG Q1 GDP + MAS Statement, KR Interest Rate Decision (Fri eve UK GDP, Fri night US Michigan Consumer Sentiment).
Holidays in Asia this week
- Tue Apr 9th Indonesia, Malaysia, Philippines.
- Wed Apr 10th Indonesia, Malaysia, Philippines, Singapore.
- Thu Apr 11th India, Indonesia, Malaysia.
- Fri Apr 12th Indonesia.
Headlines/economic data
Australia/New Zealand
- ASX 200 opens +0.3% at 7,811.
- Australia Mar NAB Business Confidence: 1 v 0 (nil) prior.
- Australia Apr Westpac Consumer Confidence: 82.4 v 84.4 prior (consumer mood slump extends to 2 years).
- Australia ANZ Roy Morgan Weekly Consumer Confidence Index: 81.9 v 82.8 prior.
- Australian plans build-to-rent tax incentives - Press.
- Australia PM Albanese says no plans to expand AUKUS membership beyond US, UK and Australia - comments from Canberra.
- New Zealand NZIER Business Opinion Survey: Q1 Business confidence -25% v -2% q/q.
China/Hong Kong
- Hang Seng opens +0.5% at 16,819.
- Shanghai Composite opens -0.1% at 3,044.
- HKMA Yue: Reiterates Bond Connect should be open to additional investors.
- China to conduct 'routine' anti-graft inspections on various financial entities [includes PBOC, CSRC, Bank of China, Chinese exchanges, ICBC] – Xinhua [update].
- BlackRock analyst sees short-term risks for onshore China bond market, but expects the market to be supported in the longer-term by slower growth - China Securities Journal.
- China Commerce Min Wang holds meeting with French brandy firms. Says China's probe does not target any EU members – MOFCOM.
- China reportedly may issue oil products exports quota this month – press [overnight update].
- China Premier Li Qiang: Domestic economy faces more external uncertainties [overnight update].
- China PBOC sets Yuan reference rate: 7.0956 v 7.0947 prior.
- China PBOC Open Market Operation (OMO): Sells CNY2B in 7-day reverse repos; Net CNY0B v net CNY0B prior.
Japan
- Nikkei 225 opens +0.4% at 39,496.
- Japan Mar Consumer Confidence: 39.5 v 39.5e.
- Japan BOJ Gov Ueda: While Japan's economy shows some weakness, it is recovering moderately - Parliamentary testimony.
- Japan Fin Min Suzuki: Reiterates that FX should move stably and reflect fundamentals.
- Japan Econ Min Saito: PM Kishida is seeking chips and economic security cooperation on his US visit to meet US Pres Biden on April 10th.
- Japan corporate bankruptcies at end-Mar said to be at 9-year high with the end of COVID lifelines - Japanese press citing research firm.
- Japan sells ¥4.0T vs. ¥4.0T indicated in 6-Month Bills; Avg Yield: 0.0418% v 0.0259% prior, bid-to-cover: 4.20x v 3.79x prior.
- Japan sells ¥2.3T VS. ¥2.3T indicated in 5-year JGB bonds; AVG yield: 0.4040% V 0.3720% prior, bid-to-cover: 3.88X V 3.99X prio.
- Japan Business Lobby (Keidanren) Chief: Current JPY (yen) weakness is excessive [overnight update].
- US Ambassador to Japan Emanuel: PM Kishida believes establishing a productive relationship with North Korea would be beneficial to Japan and region [overnight update].
South Korea
- Kospi opens +0.6% at 2,733.
- South Korea to offer incentives for chip investments; Includes KRW9.4T in AI and AI chips - Korea press, citing Pres Yoon.
Other Asia
- Thailand PM Srettha: Continues to call for Bank of Thailand (BoT) to cut rates tomorrow - Thailand press.
- TSM receives $6.6B grant from US Commerce Dept to support Phoenix plant construction - financial press [overnight update].
North America
- (US) Fed's Kashkari (non-voter): Labor market no longer 'red hot', but still tight.
- (US) Former Fed's Bullard sees 3 rate cuts as base case for 2024 – US financial media.
- Tesla: Settles case related to its Autopilot technology and the fatal crash of an Apple engineer in 2018; Terms not disclosed in filing - US financial press.
- JPM CEO Dimon: US economy is resilient, markets currently expect a soft landing - annual letter.
- (US) Commerce Sec Raimondo: AI runs on 2 NM chips; TSM projects are on time and expect production at scale in next 2-3 years - CNBC.
- (US) NY Fed Mar 1-year Inflation Expectations Survey: 3.0% v 3.0% prior; 5-year Inflation Expectations Survey: 2.6% v 2.9% prior.
- (US) Fed's Goolsbee (non-voter for 2024): Economy remains strong; Jobs data confirmed that, it was quite strong.
Europe
- (EU) European countries [UK, Germany, Belgium, Netherlands, Denmark, Norway] sign declaration to protect North Sea infrastructure.
- (UK) Mar BRC LFL Sales Y/Y: 3.2% v 1.8%e [fastest rise since Aug].
- (IE) Ireland Mar Live Register Monthly Change: -0.4K v -2.0K prior.
- (CH) SNB Chair: Switzerland is one of the leading centres in the adoption of tokenization within the regulated financial system.
- (IL) Israeli PM Netanyahu: A date has been set for a Rafah invasion in Gaza.
- (IL) Hamas Official Ali Barake: Hamas rejects the latest cease-fire proposal – press.
- (IL) Follow up: Hamas says Israeli position during last round of negotiations in Cairo remains stubborn and did not meet any demands of Palestinians - press.
Levels as of 01:20 ET
- Nikkei 225, +1.0%, ASX 200 +0.5% , Hang Seng +0.8%; Shanghai Composite -0.1%; Kospi -0.5%.
- Equity S&P500 Futures: +0.1%; Nasdaq100 +0.1%, Dax flat; FTSE100 flat.
- EUR 1.0854-1.0863 ; JPY 150.77-151.92 ; AUD 0.6599-0.6513 ; NZD 0.6030-0.6049.
- Gold +0.6% at $2,363/oz; Crude Oil +0.1% at $86.54/brl; Copper -0.5% at $4.2717/lb.
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