Japan records first trade deficit in 8-months

Asia Market Update: Japan records first trade deficit in 8-months; China threatens retaliation if US implements increased tariffs

Headlines/Economic Data

General Trend:

- Equities markets higher with China markets closed for holiday,US and Canada also closed for Monday session

- Overall news light with, China, US and Canada closed for Mondayholiday

- A$ is the outperformer rising as high as 0.7935, overall USDslightly weaker across the region

-Strong yen weighing on manufacturers and exporters confidence

Japan

-Nikkei 225 opened +0.8%; closed +2%

- (JP) JapanJan Trade Balance: -¥943.4B v -¥1.02Te (1st deficit in 8-months);Adj Trade Balance: ¥373.3B v ¥144Be; Exports y/y: 12.2% v9.4%e, Imports y/y: 7.9% v 7.8%e; Exports to Asia +16%; China +30.8%; US +1.2%,EU+20.3%

- (JP)Poll of analysts say a stronger yen may cause adelay in BOJ tapering of ultra easy policy - financial press

Korea

-Kospi opened +1.3%

- (KR) Bank of Korea (BoK)sells KRW410B in 6-month monetary stabilization bonds (MSB) at 1.63%

- (KR) Bank of Korea(BoK) sells KRW1.0T vs. KRW1.0T indicated in 3-month monetary stabilizationbonds (MSB); Yield: 1.58% v 1.50% prior

- (KR) Accumulated commission-related sales ofsome 30 cryptocurrency exchange operators in South Korea are thought to havereached KRW700B at the end of 2017 v KRW8B in 2016 - Korean press

China/HongKong

-Hang Seng closed for holiday; Shanghai Composite closed for holiday

- (CN) ChinaCommerce Ministry official Wang Hejun: if the final decision [about USrestrictions on steel and aluminum imports] hurts China’s interests, we willcertainly take necessary measures to protect our legitimate rights

- (CN) China reiterates non-first-use on nuclearweapons

- (CN) China Jan bond issuance totaled CNY2.5T(CNY2.4T through inter-bank, CNY190B through Treasury issuance) - Xinhua

Australia/NewZealand

-ASX 200 opened -0.1%; closed +0.7%

- (NZ) New Zealand JanPerformance of Service Index: 55.8 V 56.0 prior

-Brambles(-3% ), BXB.AU Reports H1 (A$) Underlying Net 493.7M* v 295M y/y; Rev 2.75B v 2.52B y/y

-(NZ) New Zealand expecting 'a lot of disruption' from Cyclone Gita

- GWA Group (+12.5%), GWA.AU Reports H1 (A$) Net 27.7M v 27Me; EBIT 41.8M v 41Me; Rev 227.1M v 221Me;To divest Door & Access Systems business unit

-(AU) Australia in talks about a project to counter China’s Belt and Roadprogram – AFR

LookingAhead: Tomorrow NZ PPI and RBA meeting minutes, miner BHP reports H1 results

Other Asia

-Noble Group, NOBL.SG Updates on proposed financial restructuring: Entered ad hoc agreement withING for $700M facility; confident it can continue as a going concern; Guides Q4 net loss $1.93-1.73B

North America

- DIS “Black Panther” top film at the box office over the weekend with $192.0Min North American sales

-On Friday. US CommerceDepartment has recommended that President Donald Trump impose steep curbs onsteel and aluminum imports from China andother countries ranging from global and country-specific tariffs to broadimport quotas

- NXPI Qualcomm said to be working on deal price for NXP, said to be in low$120/shr - CNBC

Europe

- (UK) UKIP leader Boltonremoved by party members after less than five months in charge followingcriticism of his leadership and a scandal about racist comments made by hislover - press

-(UK) Feb Rightmove House Prices m/m: 0.8% v 0.7% prior; y/y: 1.5% v 1.1% prior

-(EU) IMF's Lagarde: Have no objection to plans to turn the euro zone’s bailoutfund into a European Monetary Fund – Swiss press

-(UK) PM May rules out second vote on membership in EU, no going back on theJune 2016 vote - press

Levels as of01:00ET

- Nikkei225 +2%, Hang Seng closed; ShanghaiComposite closed; ASX200 +0.7%, Kospi +0.6%

-Equity Futures: S&P500 +0.4%; Nasdaq100 +0.4%, Dax +0.4%; FTSE100 +0.8%

- EUR 1.2435-1.2399; JPY104.44-106.09; AUD 0.7935-0.7900;NZD 0.7409-0.7377

- Apr Gold -0.5% at $1,350/oz; Apr Crude Oil +1.2%at $62.30/brl;Mar Copper -0.2% at $3.23/lb