RBNZ started bond purchases under QE program
|Asia Market Update: Asian indices rise after US gains on Tuesday; US equity FUTs pare losses amid report Senate reached agreement on stimulus plan; RBNZ started bond purchases under QE program.
General Trend:
- Japanese REIT, Marine Transportation, Iron & Steel, Securities and Insurance indices are all moving higher by over 5%
- Automakers in Japan track the earlier strength seen in the US auto sector
- Nikkei-weighed Softbank rises by over 6%, adds to the gains seen on Monday and Tuesday’s sessions
- Shanghai Composite Consumer Discretionary index rises over 2.5% in early trading, most other sectors also move higher
- Sectors moving higher in Australia include Resources, Financial and Energy; Consumer Staples and Telecom sectors decline in Australia
- South Korea to ease the FX liquidity coverage ratios for banks, the move is seen as another attempt to reduce the shortage of foreign currency
- CME to launch new gold futures contract with expanded delivery; London Bullion Market Association (LBMA) is said to have offered support to the CME to facilitate the physical delivery of gold in NY
Headlines/Economic Data
Australia/New Zealand
- ASX 200 opened +1.8%
- VAH.AU Cuts domestic capcity by 90%, grounding additional 125 planes; keeping 10% domestic capacity for transportation of essential services, critical freight and logistics; to stand down 80% of workforce
- (NZ) Reserve Bank of New Zealand (RBNZ) proposes buying NZ$250M in govt bonds as part of QE
- (AU) Reserve Bank of Australia (RBA) offers to buy total of A$2.0B in bonds (target of A$2.0B) v A$4.0B prior
- (NZ) New Zealand Feb Trade Balance (NZ$): 0.6B v 0.5Be
- NUF.AU Reports H1 continued operations (A$) underlying net -114.5M v -50.7M y/y; underlying EBITDA -5.6M v +48.6M y/y; Rev 901.1M v 1.0B y/y
- (AU) Reserve Bank of Australia (RBA): Excess cash at exchange settlement (ES) accounts at A$53.6B v A$43.6B prior
- (AU) Reserve Bank of Australia (RBA) adds A$2.43B to banking system through repos v A$6.88B prior
- (NZ) Reserve Bank of New Zealand (RBNZ) purchases NZ$250M in bonds v NZ$250M sought (1st QE operations)
- (AU) Australia PM Morrison: Appointing Nev Power to lead coronavirus commission; National Cabinet to meet again Wednesday night, no press conference planned after
- (AU) Reserve Bank of Australia (RBA) to offer $10B in 84-day USD repo operation on March 26th
Japan
- Nikkei 225 opened +2.0%
- (JP) Bank of Japan (BOJ Summary of Opinions from March 16th emergency policy meeting: Appropriate for the Bank to enhance monetary easing, with a view to doing its utmost to ensure smooth corporate financing and maintaining stability in financial markets, thereby preventing firms' and households' sentiment from deteriorating
- (JP) JAPAN PM ABE CONFIRMS THAT TOKYO OLYMPIC GAMES TO BE POSTPONED FOR ONE YEAR
- 1605.JP To review investment plans and reduce costs due to coronavirus, do not know how long it will affect oil prices
- (JP) Japan Ruling Party (LDP) Senior Official: Desirable to have size of economic steps more than ¥56.8T in project base at the time of Lehman shock
- (JP) Japan Government Pension Fund (GPIF) said to make allocation changes to portfolio; including raising foreign bond allocation - financial press
- (JP) Bank of Japan (BOJ): Offers to sell ¥2.0T in JGBs in repo agreement that begins on March 31st; offers to sell ¥400B in JGBs in repo agreement that begins on March 26th
Korea
- Kospi opened +3.6%
- (KR) South Korea reports 100 additional coronavirus cases in the last 24-hours v 76 prior; Total 9,137 v 9.037 prior; total deaths 126 v 120 prior
- (KR) South Korea Fin Min Kim: Fair to say budget surplus achieved in 2019 has already been used up; Govt to relax liquidity coverage ratio rule for banks temporarily; govt will prepare various layers of tools to inject FX liquidity into the market
- 020560.KR Makes 10.5K employees take 15-days unpaid leave in April in response to coronavirus – Yonhap
- (KR) South Korea Fin Min Kim: Fair to say budget surplus achieved in 2019 has already been used up; Govt to relax liquidity coverage ratio rule, levy on currency borrowing for banks temporarily; govt will prepare various layers of tools to inject FX liquidity into the market
- (KR) Bank of Korea (BOK) to supply USD liquidity next week via swap line with US - press
China/Hong Kong
- Hang Seng opened +2.6%; Shanghai Composite opened +1.9%
- (CN) China National Health Commission Coronavirus Update for March 24th: 47 additional cases (all imported) v 78 prior; Additional deaths: 4 v 7 prior; Hubei: 0 additional cases v 1 prior; additional deaths: 3 v 7 prior
- (CN) China President Xi to participate virtual G20 summit on March 26th
- (CN) China PBOC sets Yuan reference rate: 7.0742 v 7.0999 prior
- (CN) China PBoC Open Market Operation (OMO): Skips reverse repo operations for the 26th consecutive session, Net CNY0B v CNY0B prior
- (CN) China PBOC to conduct CNY5.0B central bank bill swap (CBS) operation on today's session v CNY5.0B prior at 2.35% v 2.35% prior
- (CN) China NDRC: Encourages China local govts to stockpile poultry and aquaculture products temporarily
- (CN) China PBOC in talks to cut rate that banks pay on savings accounts - FT
North America
- (US) Weekly API Crude Oil Inventories: -1.3M v -0.4M prior
- (US) President Trump: Reiterates would be great to open by Easter, looking at data - coronavirus update; won't hesitate to invoke Defense Production Act
- (US) White House economic adviser Kudlow: Stimulus bill would be the single largest main street assistance package in the history of the US
- (US) President Trump considering a 90-day deferral of tariffs on all imported goods from "around the world" - US Financial Press
- BA Said to plan to restart 737 Max production by May - financial press
- (US) TTN March 24th Avg Traffic Intensity Index in Select US cities y/y: 9.0% v 8.8% prior (1st increase in 9 days)
Europe
- (IT) Italy PM Conte: denies reports that lockdown will be extended to July 31st; lockdown will be lifted well before then; Hope very soon to be able to loosen lockdown restrictions
- TKA.DE Reaches agreement with union, IG Metall, to cut 3,000 jobs at its steel unit due to coronavirus
Levels as of 1:15ET
- Hang Seng +1.6%; Shanghai Composite +1.4%; Kospi +3.5%; Nikkei225 +6.4%; ASX 200 +5.5%
- Equity Futures: S&P500 -1.5%; Nasdaq100 -1.9%, Dax -0.7%; FTSE100 +0.4%
- EUR 1.0824-1.0761; JPY 111.56-110.75 ;AUD 0.6035-0.5937; NZD 0.5884-0.5795
- Commodity Futures: Gold +0.5% at $1,668/oz; Crude Oil+3.3 % at $24.77/brl; Copper -0.9% at $2.18/lb
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.