Asia Mid-Session Market Update: China industrial profits slow; New Zealand CPI rises to 2-year high and inside RBNZ target range
***US Session Highlights***
- Dow Jones Industrial opens above 20K for first time
- Vix drifts back towards 2014 low
- (CN) China Banking Regulator (CBRC): China commercial banking sector end-2016 bad loans at CNY1.51T; ratio at 1.74%
- (US) MBA MORTGAGE APPLICATIONS W/E JAN 20TH: 4.0% V 0.8% PRIOR
- (UK) PM May: Confirms will set out Brexit plans in White Paper
***US markets on close: Dow +0.8%, S&P500 +0.8%, Nasdaq +1.0%***
- Best Sector in S&P500: Financials
- Worst Sector in S&P500: Utilities
- Biggest gainers: STX +14.0%, ROK +7.7%, HBAN +5.8%, HBI +5.3%, WDC +5.3%
- Biggest losers: TXT -5.4%, CA -5.0%, STT -3.4%, DISCA -3.2%, NEM -3.0%
- At the close: VIX 10.8 (-0.3pts); Treasuries: 2-yr 1.24% (+2bps), 10-yr 2.52% (+5bps), 30-yr 3.11% (+5bps)
***US movers afterhours***
- URI: Reports Q4 $2.67 v $2.30e, R$1.52B v $1.50Be; +8.7% afterhours
- EBAY: Reports Q4 $0.54 v $0.54e, R$2.40B v $2.41Be- Guides Q1 $0.46-0.48 v $0.52e; R$2.17-2.21B v $2.23Be; +8.6% afterhours
- TER: Reports Q4 $0.32 v $0.21e, R$380M v $345Me; raises dividend 17% to $0.07 (indicated yield 1.03%); +8.3% afterhours
- NOW: Reports Q4 $0.24 v $0.23e, R$391.7M v $379Me; +6.0% afterhours
- WGL: AltaGas Ltd. to acquire WGL Holdings in C$8.4B transaction for US$88.25/shr; +3.4% afterhours
- CTXS: Reports Q4 $1.61 v $1.50e, R$908M v $899Me; authorizes $500M increase to share repurchase (3% of market cap); -4.1% afterhours
- LVS: Reports Q4 $0.62 v $0.65e, R$3.08B v $3.15Be; -4.2% afterhours
- MCK: Reports Q3 $3.03 v $2.95e, R$50.1B v $50.7Be; -5.9% afterhours
- MAT: Reports Q4 $0.52 v $0.71e, R$1.83B v $1.98Be; Total net sales (cc) -8% y/y; Gross margins -320bps to 47.0% v 50.2% y/y; -10.7% afterhours
***Asia Key economic data:***
- (CN) CHINA DEC INDUSTRIAL PROFITS Y/Y: 2.3% V 14.5% PRIOR; YTD (2016): 8.5% V 9.4% PRIOR
- (NZ) NEW ZEALAND Q4 CPI Q/Q: 0.4% V 0.3%E; Y/Y: 1.3% (2-year high) V 1.2%E
- (JP) JAPAN DEC PPI SERVICES Y/Y: 0.4% V 0.3%E
- (PH) PHILIPPINES Q4 GDP Q/Q: 1.7% V 1.9%E; Y/Y: 6.6% V 6.6%E ; 2016 6.8%
***Asia Session Notable Observations, Speakers and Press***
China:
- (CN) PBOC's recent operations show a Neutral stance on policy - Chinese press
- (CN) PBoC deputy gov Yi Gang: China does not meet currency manipulator criteria - SCMP
- (CN) China Premier Li: economic openness serves everyone better, at home and abroad
Japan:
- (JP) Japan PM Abe: to finalize details of US-Japan summit
- (JP) Japan PM Abe adviser Honda: Sees merit in compiling a ¥5T extra budget
- (JP) BOJ officials suggest there is no cause for concern over losses on its JGB holdings since rates are back above zero - Nikkei
- (JP) Japan govt said to consider its first cut to pension payments in 3 years - Japan press
Australia / New Zealand:
- (NZ) BNZ: Today's Q4 CPI data key for RBNZ policy decision - press
- (NZ) New Zealand July-Nov operating balance was a deficit of NZ$768M v deficit NZ$1.7B forecast in HYEFU - NZ press
***Asian Equity Indices/Futures (00:30ET)***
- Nikkei +1.5%, Hang Seng +1.3%, Shanghai Composite +0.1%, ASX200 closed, Kospi +1.0%
- Equity Futures: S&P500 +0.1%; Nasdaq +0.3%; Dax +0.4%; FTSE100 +0.1%
***FX ranges/Commodities/Fixed Income (00:30ET)***
- EUR 1.0745-1.0765; JPY 113.05-113.45; AUD 0.7565-0.7585; NZD 0.7250-0.7310
- Feb Gold flat at $1,198/oz; Mar Crude Oil +0.8% at $53.19/brl; Mar Copper -0.2% at $2.71/lb
- GLD: SPDR Gold Trust ETF daily holdings fall 5.0 tonnes to 799.1 tonnes; 3rd straight decline; Lowest since Mar 16th, 2016
- (CN) PBOC to inject combined CNY60B in 14-day and 28-day reverse repos v CNY30B prior
- (JP) Japan investors sold net ¥539B in foreign bonds v bought ¥335B in prior week; Foreign investors sold net ¥376B in Japan stocks v bought ¥239B in prior week
- (NZ) New Zealand Finance Ministry sells NZ$150M in 20-yr bonds; bid-to-cover 3.63x
***Asia equities / Notables / movers by sector***
- Consumer discretionary: 1928.HK Sands China -1.1% (Q4 result); 2866.HK China Shipping Container +1.2% (profit alert); 538.HK Ajisen China Holdings Ltd -1.0% (profit alert); 000625.CN Chongqing Changan Automobile Co Ltd +1.0% (guidance)
- Financials: 2628.HK China Life Insurance +1.2% (profit warning); 000166.CN Shenwan Hongyuan Group +1.1% (guidance); 601211.CN Guotai Junan International +0.7% (guidance)
- Industrials: 000928.CN Sinosteel Engineering & Technology Co +5.3% (guidance); 000270.KR Kia Motors Corporation +0.9%, 005380.KR Hyundai Motor Co +0.4% (Q4 result); 1138.HK China Shipping Development Co -2.1% (profit alert); 1919.HK China Cosco Holdings Co -0.3% (guidance); 2238.HK Guangzhou Automobile Group +2.6% (profit alert); 005380.KR Hyundai Motor Co +0.7% (Q4 result)
- Technology: 00660.KR Hynix Semiconductor +2.9% (Q4 result); 6502.JP Toshiba Corporation +1.3% (may sell stake to multiple buyers)
- Materials: 1108.HK Luoyang Glass +1.2% (profit alert); 323.HK Maanshan Iron & Steel -0.4% (FY16 prelim result); 005490.KR Posco +4.1% (FY16 result)
- Energy: 1171.HK Yanzhou Coal Mining Co +0.7% (profit alert); 857.HK Petro China +1.1% (profit warning); 1088.HK China Shenhua +2.1% (profit alert)
- Telecom: 762.HK China Unicom +3.4% (profit warning)