Fed’s Powell does not comment on monetary policy amid pause speculation

Asia Market Update: Asian equity markets trade cautiously in the face of lingering concerns related to Huawei, trade; Fed’s Powell does not comment on monetary policy amid pause speculation; US payrolls report in focus

General Trend:

- Japan said to be the latest government to place restriction on Huawei (Japanese press)

- Softbank declines over 3%, IPO for mobile unit in focus amid service disruption

- Hang Seng weighed down by declines in financials, oil and materials firms; Tech shares rise after declines on Thursday

- Chinese pharmaceutical shares decline for 2nd straight session, government procurement tender cited

- Australia cement firm Adelaide Brighton declined over 8%, cut guidance

- Fed’s Williams noted the need to be ‘nimble’ about responses to unexpected circumstances

- China PBoC said liquidity is at ‘plentiful’ level, skipped open market operation for 31st straight session

- Major currencies generally quiet ahead of US payrolls report

- China Jan-Nov trade data is scheduled to be released on Dec 8th (Saturday)

Headlines/Economic Data

Australia/New Zealand

- ASX 200 opened +0.1%

- (AU) Australia Nov AiG Performance of Construction Index: 44.5 v 46.4 prior

China/Hong Kong

- Shanghai Composite opened +0.2%, Hang Seng +0.4%

- (CN) White House official: Pres Trump was unaware of Huawei extradition request before dinner with Pres Xi in Argentina – press

- (CN) China Commerce Ministry (MOFCOM): Reiterates to appropriately deal with trade frictions; will implement trade remedy measures agreed with other relevant government parties

- Huawei: Forced to meet UK 5G security demands - FT

Japan

- Nikkei 225 opened +0.7%

- Nissan [7201.JP]: Former Chairman Ghosn said to be expected to be indicted and re-arrested on Monday by prosecutors in Tokyo; Prosecutors are also expected to file charges against Nissan Motor itself - US financial press

- (JP) Bank of Japan Gov Kuroda: Overall global economy will continue to grow, reiterates overseas economies facing 'heightening' risks; So far impact of US/China trade friction 'limited'

- (JP) BoJ Maeda: BoJ holds 77.5% of Japan's total ETF market as of Sept of this year

- (JP) Japan Sept Household Spending y/y: -0.3% v 1.0%e

- (JP) Japan Oct Labor Cash Earnings Y/Y: 1.5% v 1.0%e; Real Cash Earnings Y/Y: -0.1% v -0.3%e

- (JP) Japan Nov Official Reserve Assets: $1.26T v $1.25T prior

- (JP) Japan Oct Preliminary Leading Index: 100.5 v 104.9e; Coincident: 104.5 v 117.1e

- (JP) Japan government said to plan to exclude Huawei and ZTE from government use - Japanese Press

Korea

- Kospi opened -0.3%

- (KR) South Korea Finance Ministry: To seek regular issuance of 50-year bonds in 2019 after study

- (KR) South Korea sells KRW600B v KRW600B indicated in 50-year bonds: avg yield 1.950% v 2.09% prior

- (KR) South Korea President Moon approval rating declines to 49% from 52% - Gallup Poll

Other

- Kotak Mahindra Bank [KMB.IN]: Reportedly Berkshire Hathaway may look to invest $4-6B - CNBC

North America

- (US) Fed still expected to raise rates in Dec, but now considering if it should signal a 'wait and see' stance in 2019 - WSJ

- (US) Fed Chair Powell: Reiterates economy currently performing very well overall; US Labor market is very strong by many measures; does not comment on monetary policy

- (US) Fed’s Williams (moderate, voter): Need to be 'nimble' about responding to unexpected economic circumstances; So far US tariffs do not have 'big' effect on overall growth and inflation, direct impact of tariffs so far is relatively 'small', 'full-blown' trade war would be real worry

- (US) Fed's Bostic (dove, voter): Fed policy ought to be taking more neutral position; Fed is within shouting distance of neutral policy

- Tesla [TSLA]: General Counsel Todd Maron to step down, expected to be replaced by Dane Butswinkas, effective in Jan 2019 - US financial press

Levels as of 01:00ET

- Nikkei 225, +0.7%, ASX 200 +0.4%, Hang Seng flat; Shanghai Composite flat; Kospi +0.5%

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

- EUR 1.1387-1.1369 ; JPY 112.87-112.64 ; AUD 0.7242-0.7218 ;NZD 0.6891-0.6870

- Feb Gold +0.1% at $1,245/oz; Jan Crude Oil -0.5% at $51.26/brl; Feb Copper +0.3% at $2.756/lb

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