Indices trade mixed amid US holiday; CN and HK markets outperform,

Asia Market Update: Indices trade mixed amid US holiday; CN and HK markets outperform, China y/y GDP and Industrial Production beat ests; Precious metals pared loss; Yen and JGB yields rise on BOJ speculation.

General Trend

- Shanghai Financials extend gains, IT cos. also rise; Consumer firms lag amid retail sales data

- Hang Seng TECH index rises over 3%, Property and Finance indices lag

- Decliners in Australia included Resources, Financial and Energy cos.

- Automakers, Marine Transportation and Real Estate firms are among the decliners in Japan

- TSMC expected to get all of Intel’s CPU outsourcing orders (Taiwan press), Samsung Electronics declines in South Korea

- Trump administration said to plan to deny and revoke export licenses related to Huawei

- USD sees modest gains vs. the commodity currencies; CAD declines amid report related to the Keystone XL Pipeline, drop in oil prices

- WTI Crude Oil Contract rolled over to the March 2021 contract

- Copper extended rebound after China data

- Quiet trading seen thus far for US Treasury FUTs

- Japan’s Diet started its regular session on Monday (Jan 18th)

Headlines/Economic Data

Australia/New Zealand

-ASX 200 opened 0.0%

-JBH.AU Reports H1 (A$) Net 317.7M v 170.6M y/y; EBIT 462.7M v 263.0M y/y; Rev 4.9B v 4.0B y/y

- (NZ) RBNZ buys NZ$195M v NZ$310M prior (last on Dec 15th) in government bonds as part of QE v NZ$195M sought

- (NZ) New Zealand Local Government Funding Agency (LGFA) raises 2020-21 bond program from NZ$2.8B to NZ$3.0B, dates unchanged

Japan

-Nikkei 225 opened -1.0%

- (JP) Japan Nov Final Industrial Production M/M: -0.5% v 0.0% prelim; Y/Y: -3.9% v -3.0% prelim

- (JP) Japan Cabinet approval rating 39%, -6ppt w/w - Yomuri poll

- (JP) Bank of Japan (BOJ said to consider a proposal to allow wider fluctuations around its long-term yield target by 0.2% either side of zero - Japan press

- (JP) Japan Fin Min Aso: Striving to get budget passed as soon as possible; reiterates no adjustment of budget needed now, will use reserve funds if virus spreads

- (JP) Japan Economy Min Nishimura: Sees economy picking up due to COVID stimulus, but downside risks remain over virus resurgence - Diet

Korea

-Kospi opened -0.2%

- (KR) South Korea President Moon: South Korea has failed to stabilize real estate market; to prepare special measures on property; Not time to speak of pardoning former Presidents

- 005930.KR Heir and vice chairman Lee receives 2.5 year sentence for bribery (prosecutors were seeking 9)

China/Hong Kong

-Hang Seng opened -0.4%; Shanghai Composite opened -0.3%

- (CN) China reports 109 new COVID cases (6th day above 100) in Beijing and 3 provinces - press

- (CN) CHINA Q4 GDP Q/Q: 2.6% V 2.7%E; Y/Y: 6.5% V 6.2%E; 2020 GDP Y/Y: 2.3% v 2.1%e (more than 40 year low)

- (CN) CHINA DEC INDUSTRIAL PRODUCTION Y/Y: 7.3% V 6.9%E (9th consecutive increase); 2020 Y/Y: 2.8% V 2.7%E

- (CN) CHINA DEC RETAIL SALES Y/Y: 4.6% V 5.5%E; 2020 Y/Y: -3.9% V -3.9%E

- (CN) CHINA DEC PROPERTY INVESTMENT YTD Y/Y: 7.0% V 7.2%E

- (CN) China Dec Surveyed Jobless Rate: 5.2% v 5.2%e

- (CN) CHINA DEC FIXED URBAN ASSETS YTD Y/Y: 2.9% V 3.2%E

- (CN) China National Bureau of Stats (NBS) Chief Ning Jizhe: China met 2020 major economic targets better than expected

- (CN) China CBIRC Chairman Guo: China stands firmly against monopolies, big misunderstanding China has state capitalism - speaking from Asian Financial Forum

- (CN) China PBOC Open Market Operation (OMO): Injects CNY2.0B in 7-day reverse repos v CNY2.0B in 7-day reverse repos prior; Net drain CNY3.0B v Net drain CNY3.0B prior

- (CN) China PBOC sets Yuan reference rate: 6.4845 v 6.4633 prior

- (HK) Hong Kong Finance Chief Chan: As business closures accelerate, unemployment will rise, expected to reach record high in Q4 - SCMP

- (CN) China Ministry of Industry and Information Technology (MITT) drafts guidelines on rare earth sector management including production and export; calls on companies to abide by export regulations – press (late Friday)

- (CN) China PBoC Vice Gov Chen Yulu: 2021 monetary policy to provide necessary support for recovery and be more flexible, targeted and appropriate (late Friday)

Other

- (SG) SINGAPORE DEC NON-OIL DOMESTIC EXPORTS M/M: 6.6% V 3.5%E; Y/Y: 6.8% V -1.1%E; Electronic Exports Y/Y: +13.7% v -4.0% prior

- 2330.TW Intel orders outsourced to Taiwan may increase 10% in 2021 - Taiwan press, Economic Daily New

North America

- PFE Norway Medicines Agency reiterates safety of Pfizer COVID vaccine following 23 deaths within days of receiving their 1st COVID vaccine dose

- (US) Treasury Sec nominee Yellen reportedly to affirm commitment to market-determined US dollar rate; will make clear US does not seek weaker dollar for competitive advantage - US financial press

- (US) Trump administration revoked at least one of Intel's licenses to sell to Huawei - financial press

- (US) US President-elect Biden is planning to use executive order to cancel the Keystone XL Pipeline permit - Canada press

Europe

- (UK) Foreign Min Raab: too early to talk about easing lockdown in Feb; UK hoping to ease some restrictions early spring

Levels as of 12:15ET

- Hang Seng +0.4%; Shanghai Composite +0.8%; Kospi -1.8%; Nikkei225 -1.0%; ASX 200 -0.7%

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

- EUR 1.2086-1.2065; JPY 103.93-103.69; AUD 0.7711-0.7680; NZD 0.7141-0.7117

- Commodity Futures: Gold -0.1% at $1,827/oz; Crude Oil -0.8% at $51.98/brl; Copper +0.3% at $3.61/lb