Equity markets track US declines

Asia Market Update: Equity markets track US declines; US and China officials try to reassure markets on trade talks; China services PMI surprises but outlook concerns remain, Aussie GDP slows more than expected

General Trend:

- Equities markets across the region open lower tracking New York markets Monday. Financials and Semis weigh on markets in Asia

- Trade sensitive Marine Transportation and Iron/Steel sectors weigh on markets in Japan

- Equity Futures rise after declines seen on Tuesday’s session

- Aussie dollar declines on weaker Q3 GDP

- Asian bonds gain amid growth concerns, move higher in US Treasury prices

- Nissan fails to nominate a new chairperson

- Japan JGB Futures trade at highest level since Nov 2016, tracks Tuesday's gain in US Treasuries and equity market declines

- Oil prices decline by over 1.5% in Asia

Looking Ahead: US equity markets to close on Dec 5th in honor of former President George H. W. Bush


Headlines/Economic Data


- Nikkei 225 opened -1.3%

- (JP) Bank of Japan (BOJ) Deputy Gov Wakatabe: Will maintain 'massive' stimulus to nudge up prices to 2% target

- (JP) Japan govt reportedly to increase spending on public works to ¥3T, a decade-high level in next year's budget – Nikkei

- 8591.JP Orix said to acquire Japan's Cornes AG for ¥40B ($355M) – Nikkei

- (JP) Japan Nov PMI Services: 52.3 v 52.4 prior; Composite: 52.4 v 52.5 prior

- (JP) BOJ announcement related to daily bond buying operation: Raises 10-25 yr purchases to ¥200B from ¥180B

-4502.JP ~88% of shareholders approve merger with Shire


- Kospi opened -1.3%

- (KR) South Korea Nov Foreign Exchange Reserves: $403.0B v $402.8B prior

- (KR) Bank of Korea (BOK) sells KRW2.2T in 2-yr Monetary Stabilization Bonds (MSBs) at 1.93%

- 068270.KR Presents positive results for CT-P10, biosimilar rituximab, in advanced follicular lymphoma at the American Society of Hematology Meeting 2018

China/Hong Kong

- Hang Seng opened -1.9%, Shanghai Composite -1.4%

- (CN) Fitch affirms China sovereign rating at A+; Outlook stable

- (CN) China PBoC struggling as the easing it is giving banks is not resulting in impacting the real economy - SCMP

- 1958.HK Reportedly Daimler is in talks with BAIC; said to float plan to boost stake in China Venture - press

- (CN) Analysts warn that 90-days is not enough time bridge the very wide gap between China and the US on trade - SCMP

- (CN) China top developers fall as Nov figures show another month of declines, property market looking at a possible year of recession depending on Dec – SCMP

- (CN) China Commerce Ministry (MOFCOM): Reiterates to push forward trade negotiations with the US in 90-days, confident to execute trade talk results; To implement specific items agreed upon meeting 'ASAP'

- (HK) Hong Kong Nov PMI: 47.1 v 48.6 prior (close to 2.5-yr low)

- (CN) China National Development and Reform Commission (NDRC): Govt agencies sign MOC for joint efforts to strengthen punishment for intellectual property (IP) infringements – Xinhua

- (CN) Analysts note that China's pledge to buy more American agricultural products could turn a bumper Brazil harvest of soybeans into a global glut – SCMP

- (CN) China PBoC Open Market Operation (OMO): Skips open market operation v skipped prior (29th straight skip)

- (CN) China PBoC sets yuan reference rate: 6.8476 v 6.8939 prior (strongest fix since late Sept )

- (CN) CHINA NOV CAIXIN PMI SERVICES: 53.8 V 50.7E (5-month high); COMPOSITE: 51.9 V 50.5 PRIOR

- (US) We are either going to have a REAL DEAL with China, or no deal at all - at which point we will be charging major Tariffs against Chinese product being shipped into the United States. Ultimately, I believe, we will be making a deal - either now or into the future...China does not want Tariffs! - tweet

Australia/New Zealand

- ASX 200 opened -0.9%

- (AU) AUSTRALIA Q3 GDP Q/Q: 0.3% V 0.6%E (lowest rate since early 2017); Y/Y: 2.8% V 3.3%E; GDP Final Consumption: 0.3% v 0.7% prior; GDP Deflator q/q: 0.9% v 0.1% prior; GDP Capital Expenditure q/q: 0.1% v 0.0% prior


- TME.NZ Confirms alternative preliminary nonbinding indicative proposal for NZ$6.45/shr received from Hellman & Friedman

- (AU) Australia Nov Final PMI Services: 53.7 v 52.6 prior; Composite: 53.9 v 52.9 prior

- YAL.AU Hong Kong HK$1.18B IPO priced at HK$23.48/shr; retail portion 0.19x covered

- TPM.AU FY19 results are tracking well ahead of guidance – AGM

- (AU) Australia sells A$1.0B v A$1.0B indicated in 2029 bonds; avg yield 2.5399% v 2.6596% prior, bid to cover 2.51x v 2.56x prior

- (AU) AMP Capital Chief Economist said the Reserve Bank of Australia (RBA) might be confronted with having to cut rates in H2 2019 (prior Q2 2019)

Other Asia

- (PH) PHILIPPINES NOV CPI Y/Y: 6.0% V 6.3%E (slowest pace since July)

- (PH) Philippines Central Bank (BSP) Gov Espenilla: Monetary policy to stay vigilant; Nov inflation confirms inflation is heading back to the 2-4% target range

North America

- (US) Weekly API Oil Inventories: Crude: +5.4M v +3.5M prior(build in all categories)

- F CEO Hackett says to make interim announcement related to workforce this week - US financial press

- (US) Special Counsel Mueller recommends no jail time for former national security advisor Michael Flynn, he provided "substantial assistance" with Russia and Trump campaign


- (UK) UK PM May Government defeated 321-299 in Vote on Parliament Brexit Power

- (UK) UK Parliament find Government in contempt over Brexit legal advice; UK Gov defeated in contempt motion 311-293; Orders Gov to publish full advice immediately; UK Parliament leader Andrea Leadsom says govt will publish its full Brexit legal advice tomorrow

- (UK) UK does not need to pass legislation through Parliament to revoke Article 50 - Sky News

- (IT) Dep PM Salvini tweets (translated): "Where it is written that I have to remove €4B from the pockets of Italians because a European commissioner told me to do so?"

- (US) White House spokesperson: Trump told German automakers he'd like to see more cars being made in the US; has no immediate plans to impose tariffs on their cars


Levels as of 12:50ET

- Hang Seng -1.8%; Shanghai Composite -0.8%; Kospi -0.8%; Nikkei225 -0.7%; ASX 200 -0.7%

- Equity Futures: S&P500 +0.3%; Nasdaq100 +0.4%, Dax +0.2%; FTSE100 +0.3%

- EUR 1.1318-1.1418; JPY 112.65-113.09 ; AUD 0.7282-0.7356;NZD 0.6909-0.6945

- Feb Gold -0.5% at $1,240/oz; Jan Crude Oil -1.5% at $52.44/brl; Feb Copper +0.2% at $2.76/lb

All information provided by Trade The News (a product of Trade The News, Inc. "referred to as TTN hereafter") is for informational purposes only. Information provided is not meant as investment advice nor is it a recommendation to Buy or Sell securities. Although information is taken from sources deemed reliable, no guarantees or assurances can be made to the accuracy of any information provided. 1. Information can be inaccurate and/or incomplete 2. Information can be mistakenly re-released or be delayed, 3. Information may be incorrect, misread, misinterpreted or misunderstood 4. Human error is a business risk you are willing to assume 5. Technology can crash or be interrupted without notice 6. Trading decisions are the responsibility of traders, not those providing additional information. Trade The News is not liable (financial and/or non-financial) for any losses that may arise from any information provided by TTN. Trading securities involves a high degree of risk, and financial losses can and do occur on a regular basis and are part of the risk of trading and investing.