Bond yields rise after PBOC’s hawkish easing move

Asia Market Update: Equities decline amid various holidays; Bond yields rise after PBOC’s hawkish easing move; CN GDP and IP beat ests, Retail sales miss; JP Fin Min and BOJ Gov comment on Yen.

General trend

- USD trades generally firmer as UST yields rise.

- South Korean bond yields extend rise.

- PBOC expected to cut the loan prime rates (LPRs) on Wed (Apr 20th).

- Companies in Shanghai start to resume production.

- US equity FUTs extend declines.

- Nikkei 225 has extended drop.

- Shanghai Composite pared decline; Banks index drops on disappointing RRR cut.

- AU, NZ and HK markets are closed for holiday.

- RBNZ Gov Orr interview with IMF to be published on Tuesday, Apr 19th.

- Rio Tinto to issue quarterly production on Tues (Apr 19th).

- Companies due to report during the NY morning include Bank of America, Charles Schwab.

Headlines/Economic data

Australia/New Zealand

- ASX 200 closed for holiday.

Japan

- Nikkei 225 opened -1.0%.

- (JP) Japan Fin Min Suzuki: No comment on possibility of FX intervention or FX levels; reiterates importance of FX stability.

- (JP) Bank of Japan (BOJ) Gov Kuroda: Weak Yen is positive for the economy as a whole, rapid weakness in the Yen drives negative effects; Reiterates desirable for FX markets to move in a stable manner; Monitoring effect of excessive FX moves on economy.

- (JP) Large Japan power company, JERA, considering starting an LNG business in China – Nikkei.

- 2651.JP To raise prices for chicken nuggets by 10% [first increase in over 35 yrs] – press.

- (JP) Japan Financial Regulator (FSA) Panel: Gives approval to streamlining the reporting system.

Korea

- Kospi opened -0.4%.

- (KR) Bank of Korea (BOK) report: Need to "actively" utilize monetary policy as a tool to tamp down inflation amid worries that prices are under growing upward pressure from supply chain disruptions, soaring commodity costs and rebounding consumption.

- (KR) Bank of Korea (BOK) Gov Nominee Rhee: Reiterates inflationary pressure will likely remain high for a considerable period of time and stressed a focus on efforts for price stability - written response to Parliament questions apart of confirmation hearing.

- (KR) Sunday South Korea reports new covid cases below 100K, this week social distancing rules to be eased this week.

- (KR) Hyundai Research Institute (think tank) sees South Korea 2022 GDP at 2.6% (prior saw 2.8%) – Yonhap.

- (KR) South Korea and US to start joint spring training exercises this week – Yonhap.

- (KR) Said that producers in South Korea have raised Cathode Material prices by up to 25% - Press.

- (KR) North Korea leader Kim observed a missile test of a new type of tactical guided weapon, thought to be part of its nuclear program - press.

China/Hong Kong

- Hang Seng closed for holiday; Shanghai Composite opened -0.8%.

- (CN) China Q1 GDP Q/Q: 1.3% V 0.7%E; Y/Y: 4.8% V 4.2%E; GDP YTD Y/Y: 4.8% v 4.2%e.

- (CN) China Mar Retail Sales Y/Y: -3.5% V -3.0%E; YTD Y/Y: 3.3% V 2.8%E.

- (CN) China Mar industrial production Y/Y: 5.0% V 4.0%E; YTD Y/Y: 6.5% V 6.2%E.

- (CN) China National Bureau of Stats (NBS): Economy faces many difficulties, challenges; China to high priority to stabilizing economic growth.

- (CN) China PBOC cuts broad required reserve ratio (RRR) BY 25BPS (to lowest level since 2007); effective Apr 25th - To cut an additional 25bps for some SMALLER city commercial banks and rural commercial banks (Friday).

- (CN) China Mar Surveyed Jobless Rate: 5.8% v 5.5%e.

- (CN) China Mar Residential Property Sales YTD Y/Y: -25.6% v -22.1% prior.

- (CN) China Mar property investment YTD Y/Y: 0.7% V 1.2%E.

- (CN) China Mar fixed urban assets ASSETS YTD Y/Y: 9.3% V 8.4%E.

- (CN) China PBOC Open Market Operation (OMO): Sells CNY10B in 7-day reverse repos v CNY10B prior; Net CNY0B v Net CNY0B prior.

- (CN) China Sec Journal: A China Brokerage firm expects the 1-year and 5-year Loan Prime rates to be cut by 5bps during the month to support further growth [next LPR setting is scheduled for Apr 20th (Wed)].

- (CN) In China 370M people are under some form of lockdown as more cities impose restrictions for covid – press.

- (CN) China PBOC sets Yuan reference rate: 6.3763 v 6.3896 prior.

- (CN) Shanghai reports 22,248 coronavirus cases; 3 coronavirus deaths.

- (CN) China Vice Premier Liu He: Calls for supply chain stability and financial support for logistics sector workers - Xinhua.

Other

- (SG) Singapore Mar non-oil domestic exports M/M: -2.3% V -6.0%E; Y/Y: 7.7% V 1.6%E; Electronic Exports Y/Y: 11.5% v 11.6% prior.

North America

- TSLA Expected to resume partial production at Shanghai facility later today; developing a Govt approved system for companies to live on site and work (dubbed the closed loop).

- DIDI To hold extraordinary general meeting on May 23, 2022; Board has authorized the Company to organize a shareholders meeting to vote on the voluntary delisting of the Company's ADSs as soon as practicable.

Europe

- (UR) Ukraine President Zelenskiy: Any Ukraine-Russia peace talks will end if Moscow eliminates Mariupol city fighters; Ukraine can fight Russia even for 10 years.

- (FR) Ipsos Poll on France 2nd round of Presidential elections: Macron leads Le Pen 55.5%-44.5%.

- (UK) UK employers are offering annual pay settlements with avg increase of 2.8% [well below inflation rate]; private sector pay settlements averaged 3.2% - Chartered Management Institute survey.

Levels as of 01:15ET

- Hang Seng closed for holiday; Shanghai Composite -0.8%; Kospi +0.1%; Nikkei225 -1.5%; ASX 200 closed for holiday.

- Equity Futures: S&P500 -0.6%; Nasdaq100 -1.0%, Dax +0.3%; FTSE100 +0.4%.

- EUR 1.0822-1.0790; JPY 126.79-126.25; AUD 0.7404-0.7351; NZD 0.6780-0.6725.

- Commodity Futures: Gold +0.6% at $1,985/oz; Crude Oil +0.9% at $107.31/brl; Copper -0.1% at $4.75/lb.