Asian CBs act to support markets, JGB yields pared rise amid upcoming BOJ operation

Asia Market Update: Asian CBs act to support markets; JGB yields pared rise amid upcoming BOJ operation; Record PBOC liquidity injection seen; Geopolitics in focus ahead of the weekend.

General trend

- China Commerce Ministry (MOFCOM): To adjust temporary export measures for graphite items; effective Dec 1st; the purpose of the export control is to safeguard interest.

- Evergrande: Announces revision of terms of proposed restructuring.

- Recent Fed speak in focus.

- Oil FUTs rise, Gold also higher; Geopolitical concerns ahead of the weekend?

- Commodity currencies trade generally lower.

- Equity markets decline after drop on Wall St..

- Shanghai Composite opened below 3,000.

- Financial and Resources indices lag in Australia.

Headlines/economic data

Australia/New Zealand

-ASX 200 opens -0.7% at 6,930.

-Australia review says it is not necessary to cancel China firm's lease on the Darwin port - financial press.

-Bluescope Steel [BSL.A]: Cuts H1 (A$) Underlying EBIT 620-670M (prior: 700-770M); the key driver of the revised guidance is North Star, where BlueScope now expects a result around half that of 2H FY2023. This is predominantly due to softer than expected benchmark steel prices and spreads across the half year.

-New Zealand Sept Trade Balance (NZD): -2.3B v -2.3B prior.

-New Zealand sells total NZ$500M vs. NZ$500M indicated in bonds.

- Reserve Bank of New Zealand (RBNZ) Credit Conditions Survey September 2023: has been a broad-based reduction in demand for credit over the last 6 months.

China/Hong Kong

-Hang Seng opens -1% at 17,127.

-Shanghai Composite opens -0.3% at 2,995.

-China PBOC Open Market Operation (OMO): Sells CNY828B in 7-day reverse repos; Net injects CNY733B v injects CNY182B prior [largest net OMO injection on record].

-Evergrande: Announces revision of terms of proposed restructuring.

-China 7-day repo rate rises to 6-month high.

-CHINA PBOC MONTHLY LOAN PRIME RATE (LPR) SETTING LEAVES RATES UNCHANGED; AS EXPECTED.

-Pentagon report says China is growing its nuclear weapons arsenal faster than previous projections - press (update).

-Evergrande: Evergrande onshore unit gets approval for yuan bond payment extension - press.

-CATL: Reports Q3 (CNY) Net 10.4B v 13.0Be, Rev 105.4B v 110.7Be.

-Hong Kong Exchanges: Reports Q3 (HK$) Net 2.95B v 2.26B y/y, EBITDA 3.71B v 3.59Be, Rev 5.08B v 4.92Be.

-China PBOC sets Yuan reference rate: 7.1793 v 7.1795 prior.

Japan

-Nikkei 225 opens -0.8% at 31,114.

-BANK OF JAPAN (BOJ): TO CONDUCT FUND-SUPPLYING OPERATIONS ON OCT 24th (Tues); the duration of the loans will be 5 years [announcement follows the rise in JGB yields].

-JAPAN SEPT NATIONAL CPI Y/Y: 3.0% V 3.0%E; CPI EX-FRESH FOOD (CORE) Y/Y: 2.8% V 2.7%E [core CPI below 3.0% for the first time since Aug 2022].

-Japan Fin MIn Suzuki: Can't comment on income tax cut; nothing specific on income tax cut; reiterates important that FX moves stably, reflecting fundamentals.

-Daiichi Sankyo [4568.JP]: Co. and Merck Announce Global Development and Commercialization Collaboration for Three Daiichi Sankyo DXd ADCs; to receive upfront payment of $4.0B; Merck will record an aggregate pretax charge of $5.5B.

-Isuzu: Plans to sell light EV truck in the US from 2024; to partner with Chargepoint.

- Japanese press.

Korea

-Kospi opens -1% at 2,391.

-South Korea Fin Min Choo: FX reserves are ample enough; to respond to any market jitters if needed.

Other Asia

-INDONESIA CENTRAL BANK (BI) RAISES REVERSE REPO RATE BY 25BPS TO 6.00%; NOT EXPECTED; resumes tightening cycle.

-Malaysia Sept CPI Y/Y: 1.9% v 2.1%e (moves below target range for 1st time in 29 months).

-Malaysia Q3 Advance reading of GDP seen at 3.3% - press.

-Taiwan Semi: Reports Q3 (NT$) Net 211B v 195Be, Op 228.1B v 216.6Be, Rev 546.7B v 613.1B y/y [from Oct 19th].

North America

-GM[GM]: Co. and UAW said to be getting closer to tentative agreement; cites UAW negotiator - US financial press.

-Tesla [TSLA]: Said to have raised price for all-wheel drive Model X Plaid in US by ~5.5% - US financial press.

-(US) Fed Chair Powell: Lower summer inflation readings are very favorable, but Sept data is somewhat less encouraging; Yields have driven significantly tighter financial conditions - NY economic club speech.

-Fed's Logan (voter): Reiterates has seen welcome progress on inflation, but it is still too high; rise in bond yields has been 'pretty orderly'.

-(US) Fed's Harker (Voter): Latest data coming in a tad stronger than my forecast.

-(US) DOE to issue monthly additional oil purchase solicitations for the SPR at least through May 2024; Seeking contracts at $79/bbl or less.

-Jazz Pharmaceuticals [JAZZ]: Said to examine options including a sale - US financial press.

Europe

-(US) President Biden: Confirms will seek additional funds for Israel and Ukraine.

-Lebanon Army: Media person killed by Israeli gunfire in Southern Lebanon.

-Egypt border is not expected to open for Gaza aid on Fri - US media.

-(IL) Fitch puts Israel A+ rating on Watch Negative.

-US Navy warship traveling near Yemen intercepted multiple projectiles - press [from Oct 20th].

-(IQ) Rocket attack targets Iraqi military base near Baghdad Airport - press.

-*(UK) OCT GFK CONSUMER CONFIDENCE: -30 V -20E [lowest since Jul].

-(UK) Labour Party wins Tamworth seat in by-election, party also wins the Mid-Bedfordshire by-election - UK media.

-(EU) Reportedly deal to allow EU automakers to benefit from US subsidies under the IRA faces a new hurdle just 24 hours before it was expected to be agreed upon at a summit meeting - FT.
-Stellantis: Announces 100 additional layoffs at Toledo, OH plant, citing UAW strike - press.

-Credit Suisse said to prepare 'wave of job cuts' - financial press.

Levels as of 01:20 ET

- Nikkei 225, -0.2%, ASX 200 -1.2% , Hang Seng -0.5%; Shanghai Composite -0.7% ; Kospi -1.1%.

- Equity S&P500 Futures: -0.2%; Nasdaq100 -0.3%, Dax +0.1%; FTSE100 -0.1%.

- EUR 1.0587-1.0568 ; JPY 149.94-149.74 ; AUD 0.6330-0.6305 ;NZD 0.5855-0.5821.

- Gold +0.5% at $1,990/oz; Crude Oil +1.1% at $89.38/brl; Copper -0.5% at $3.5697/lb.