NZD pares gain seen after CPI
|Asia Market Update: Indices trade generally higher after US gains; NZD pares gain seen after CPI, BoK says premature to discuss non-conventional tools, US earnings continue to be in focus
General Trend:
- Shanghai Composite pares gain; Property shares and financials pare gains after PBOC again left MLF rate unchanged
- Chinese liquor giant Kweichow Moutai declines on earnings
- Hang Seng pares gain as policy speech by Chief Executive Lam delayed amid protests
- Hong Kong Chief executive Lam’s policy address was adjourned several times as pro-democracy lawmakers heckled her
- HK property index rises on comments by HK leader
- Banks lead gains in Japan after rise in US Treasury yields
- Rio Tinto pares gain after release of quarterly production update; BHP expected to issue quarterly production on Thursday (Oct 17th)
- US firm Tech Data rises over 13% in afterhours trading on M&A speculation
- China says it will retaliate against the US as the US House of Representatives passed the bill supporting the HK protesters
- Kiwi pares gain seen after CPI data amid RBNZ speak
- Bank of Korea cut interest rates (as expected) and indicated it would be cutting GDP and CPI outlooks after Q3 data
- Taiwan Semi expected to report results on Thursday (Oct 17th)
- Companies expected to report results during the NY morning include Bank of America, Bank of New York and PNC.
- Aussie monthly jobs data due for release on Thursday (Oct 17th), RBA Gov Lowe due to speak at IMF event on Oct 18th (7:00 am AEDT)
Headlines/Economic Data
Australia/New Zealand
- ASX 200 opened +0.1%
- RIO.AU Reports Q3 Pilbara iron ore production 87.3Mt v 85.5Mte v 82.5Mt y/y (100% basis); Shipments 86.1Mt v 85.8Mte v 81.9Mt y/y (100% basis); Affirms FY20 Pilbara shipments
- (NZ) NEW ZEALAND Q3 CPI Q/Q: 0.7% V 0.6%E; Y/Y: 1.5% V 1.4%E
- OZL.AU Reports Q3 gold production 30.3K oz, -17% y/y at AISC $128/lb v $120 q/q; Copper 24.7K oz v 28.5K oz q/q
- (NZ) Reserve Bank of New Zealand (RBNZ) Dep Gov Bascand: We remain vulnerable to external shocks; lower rates may still be needed to achieve objectives
- (AU) Australia sells A$800M v A$800M indicated in 2030 bonds; avg yield 1.0742% v 0.9438%; bid to cover 2.17x v 2.53x prior
- (NZ) New Zealand Q3 RBNZ Sectoral Factor Model Inflation Index y/y: 1.7% v 1.7% prior; Sectoral Factor Model Non-Tradeable (core) Y/Y: 3.2% v 2.8% prior
Japan
- Nikkei 225 opened +1.2%
- (JP) Japan PM Abe: Will use ¥710M from reserves for typhoon response
- 3258.JP Appoints Committee to Evaluate Blackstone Proposal: have not been contacted by Blackstone, have asked special committee to consider the proposal
- (JP) Japan Economy Min Nishimura: Reiterates recent sales tax hike not expected to have as big of an impact as last time, paying close attention to impact of typhoon
Korea
- Kospi opened +0.6%
- (KR) BANK OF KOREA (BOK) CUTS 7-DAY REPO RATE BY 25BPS TO 1.25%; AS EXPECTED; cuts outlook on CPI and GDP
- (KR) South Korea Sept Export Price Index M/M: -0.8% v 1.4% prior; Y/Y: -5.0% v -4.0% prior
China/Hong Kong
- Hang Seng opened +0.2%; Shanghai Composite opened +0.1%
- (CN) China Foreign Ministry urges US to stop pushing forward Hong Kong bill and resolutely opposes it and plans to retaliate
-(HK) Hong Kong Chief Exec Lam: Will not tolerate calls for Hong Kong independence or anything that hurts national security and sovereignty; makes housing pledges as expected - policy address
- (CN) China PBOC sets Yuan Reference Rate: 7.0746 v 7.0708 prior
- (CN) China PBoC Open Market Operation (OMO): Skips for the 8th consecutive session
-(CN) CHINA PBOC CONDUCTS CNY200B V CNY200B PRIOR IN 1-YEAR MEDIUM TERM LENDING FACILITY (MLF) OPERATIONS AT 3.3% V 3.3% PRIOR; NET DRAINS CNY200B VIA MONETARY POLICY TOOLS
- (HK) Hong Kong Chief Exec Lam has now left the legislative building after policy speech was interrupted twice by opposition lawmakers shouting protests
- (HK) Hong Kong Monetary Authority (HKMA) has reduced banks' cash reserves requirement; cut the countercyclical capital buffer (CCyB) ratio for banks by 50bps to 2.0% (first cut since the ratio was introduced in 2015), effective immediately - financial press (yesterday)
Other
- (TR) Turkey President Erdogan: Rejected US request for ceasefire; not worried about sanctions
North America
- (US) House Speaker Pelosi: Confirms will hold off on full house vote authorizing an impeachment inquiry into President Trump; there is no requirement that the full house have a vote on impeachment inquiry
- JNJ Said to propose $4.0B global opioid settlement - US financial press
Europe
- (UK) Democratic Unionist Party (DUP) said to have asked for billions of cash payment for Northern Ireland to help secure support for Brexit proposal – FT
- (IT) Italy Cabinet approves draft 2020 budget plan for EU - press
Levels as of 1:20 ET
- Nikkei 225, +1.3%, ASX 200 +1.3%, Hang Seng +0.4%; Shanghai Composite -0.2%; Kospi +0.6%
- Equity Futures: S&P500 -0.3%; Nasdaq100 -0.2%, Dax -0.2%; FTSE100 -0.4%
- EUR 1.1036-1.1023; JPY 108.87-108.59 ; AUD 0.6756-0.6726 ;NZD 0.6320-0.6270
- Gold +0.3% at $1,487/oz; Crude Oil +0.3% at $52.95/brl; Copper -0.3% at $2.605/lb
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