Asia Mid-Session Market Update: Region under pressure as oil declines overnight and clarity on central bank action remains cloudy;
***Economic Data***
- (NZ) NEW ZEALAND Q2 CURRENT ACCOUNT BALANCE (NZ$): -0.95B V -0.3BE
- (NZ) New Zealand Aug REINZ median home price y/y: +6.0% v +8.6% prior; Home sales y/y: -3.1% v -10.1% prior; Home sales: 7.5K v 7.3K prior
- (AU) AUSTRALIA SEPT WESTPAC CONSUMER CONFIDENCE INDEX: 101.4 V 101.0 PRIOR, M/M: 0.3% V +2.0% PRIOR (2nd consecutive increase)
- (JP) JAPAN AUG TOKYO CONDOMINIUM SALES Y/Y: -24.7% V -30.7% PRIOR
- (JP) JAPAN JULY FINAL INDUSTRIAL PRODUCTION M/M: -0.4% V +0.0% PRELIM; Y/Y: -4.2% V -3.8% PRELIM
***Index Snapshot (as of 03:30 GMT)***
- Nikkei225 -0.2%, S&P/ASX -0.5%, Kospi closed, Shanghai Composite -0.6%, Hang Seng -0.2%, Dec S&P500 +0.3%
***Commodities/Fixed Income***
- Dec gold -0.1% at $1,322/oz, Oct crude oil +0.5% at $45.11/brl, Dec copper +0.4% at $2.11/lb
- GLD: SPDR Gold Trust ETF daily holdings fall 0.5%, 4.4 tonnes to 935.5 tonnes; 4th consecutive decline
- (CN) PBOC to inject CNY70B in 7-day reverse repos, CNY30B in 14-day reverse repos and CNY65B in 28-day reverse repos
- (CN) PBOC SETS YUAN MID POINT AT 6.6895 V 6.6726 PRIOR
- (CN) China MoF sells 2-yr bonds at 2.326% v 2.33%e; Sells 5-yr bonds at 2.527% v 2.53%e
- (AU) Australia MoF to sell its first 30-yr bond - AFR
***Market Focal Points/FX***
- Asian equity markets remain under pressure ahead of SNB and BOE interest rate decisions tomorrow, markets seem to be losing faith that global central bank action will help to boost growth and the lack of clarity on when the US Fed will take action continues to cast a long shadow. China data over the last few days also showed the economy is doing well (retail sales +10.6%, industrial production at a 5-month high, FDI +5.7% y/y) which should tamper anticipation of any additional PBoC stimulus, leaving the markets waiting for the first moverChina state researcher Wang Yiming sees the economy reaching bottom in H2 of this year or in 2017.
Crude oil futures stabilized around $45.11, after a sell off (as much as -3%) during US session due to a warning from IEA of slowing demand and a more bearish OPEC report. Weekly API oil inventories were +1.4M v -12.1M prior, reminder prior week was impacted by weather.
Australia saw September consumer confidence rise for the second consecutive month, with AUD/USD hovering just off session highs of 0.7489, but holding to a 30 pip range in the session. USD/JPY tested 103.20 in the wake of a Nikkei report indicating that the BOJ would keep negative rates at the center of any future easing policy. PM Abe said that Japan was on verge to escape deflation; monetary easing to gradually permeate through real economy.
***Equities***
US equities / ADRs:
- HOME: Reports Q2 $0.13 adj v $0.11e, R$188.4M v $183Me; +4.8% after hours
- HLF: Icahn: Herbalife would do better going private; thought about making a tender for HLF, but not likely to do it, though someone else might - Delivering Alpha conf; +2.4% after hours
- MON: Bayer improved offer likely to be announced pre-US open on Sept 14th - financial press; +2.3% after hours
- WFC: CEO Stumpf apologizes for recent scandal, all levels of management feel responsible - CNBC; -0.3% after hours
Notable movers by sector:
- Consumer discretionary: Parkson Retail Group 3368.HK +42.4% (disposal of unit); Ansell ANN.AU +1.2% (guidance); JB Hi-Fi JBH.AU -4.1% (UBS raises to Buy); Tsuruha Holdings 3391.JP -6.6% (Q1 result)
- Financials: CYBG CYB.AU -4.9% (not active in M&A talks); Platinum Asset Management PTM.AU +11.3% (Credit Suisse raised to Neutral); Tokyo Tatemono 8804.JP +3.5% (Haitong International raised to Buy); Resona Holdings 8308.JP -2.2% (Daiwa raised to outperform)
- Industrials: Air China 753.HK -0.4% (Aug result)
- Technology: Tech Pro Technology Development 3823.HK -11.1% (filed bankruptcy proceedings)
- Materials: Whitehaven Coal WHC.AU +3.3% (China buys coking coal at biggest premium)
- Energy: Sundance Energy Australia SEA.AU -1.9% (H1 result)
- Healthcare: Nippon Shinyaku 4516.JP +5.5% (SMBC lifted PT)
- Telecom: BigAir Group BGL.AU +20.8% (acquisition speculation)