Asia Mid-Session Market Update: New Zealand trade deficit narrows on dairy exports; Japan headline CPI rises for the first time in 8 months
***Asia Session Notable Observations, Speakers and Press***
- Oil retreats slightly despite reports that Saudi Arabia is pushing for OPEC production cuts.
- USD/JPY approaching fresh 8-month highs of ¥114
- Gold prices tracking firmer greenback with a fall below $1,180 as gold mining stocks suffer
- New Zealand posts a narrower trade deficit as Exports top consensus and Imports come in as expected; Exports of dairy up a robust 13% for the first time in months amid recovery in prices.
- Recovery in energy prices helping Japan headline CPI's bounce.
China:
- Vice Premier: Plan to strengthen economic cooperation with EU; Hopeful EU will fulfill WTO rules - press
- State Council: China to ensure stable coal supply; China has completed target of overcapacity cut in steel and coal this year - press
South Korea:
- Bank of Korea (BOK) said to be considering lowering their economic growth forecast - financial press
- Bank of Korea (BOK) Senior Deputy Gov Jang: Will not sit idle if the bond market is disrupted - Korean press
***Asia Key economic data:***
- (JP) JAPAN OCT NATIONAL CPI Y/Y: 0.1% (first positive print in 8 months) V 0.0%E; CPI EX FRESH FOOD (CORE) Y/Y: -0.4% V -0.4%E
- (JP) JAPAN NOV TOKYO CPI Y/Y: 0.5% (19-month high) V 0.2%E; CPI EX-FRESH FOOD Y/Y: -0.4% V -0.4%E
- (JP) Japan Oct BOJ National CPI Ex Fresh Food, Energy (core-core) Y/Y: 0.3% v 0.3%e
- (JP) JAPAN OCT PPI SERVICES Y/Y: 0.5% V 0.3%E
- (NZ) NEW ZEALAND OCT TRADE BALANCE (NZ$): -0.85B (4th straight deficit) V -0.97BE; 12-MONTH TRADE BALANCE: -3.29B V -3.39Be
- (SG) SINGAPORE OCT INDUSTRIAL PRODUCTION M/M: -0.1% V -2.0%E; Y/Y: 1.2% V 1.0%E
- (KR) SOUTH KOREA NOV CONSUMER CONFIDENCE: 95.8 V 101.9 PRIOR; 8-year low
***Asian Equity Indices/Futures (00:00ET)***
- Nikkei -0.1%, Hang Seng +0.4%, Shanghai Composite -0.2%, ASX200 +0.4%, Kospi flat
- Equity Futures: S&P e-mini +0.2%, Dax flat, FTSE100 flat
***FX ranges/Commodities/Fixed Income (00:00ET):***
- EUR 1.0540-1.0580; JPY 113.20-113.90; AUD 0.7400-0.7440; NZD 0.6980-0.7020
- Dec Gold -1.0% at 1,177/oz; Jan Crude Oil -0.7% at $47.62/brl; Dec Copper -0.2% at $2.65/lb
- JGB: (JP) Japan MoF sells ¥500B in 0.4% 40-year bonds, bid to cover: 2.98x v 2.73x prior
- (CN) China MoF sells 3-month bills at avg yield 2.11% v 2.01% prior
- USD/CNY: *(CN) PBOC SETS YUAN MID POINT AT 6.9168 V 6.9085 PRIOR; weakest Yuan setting since June 2008
- (CN) PBOC to inject CNY120B in 7-day reverse repos, CNY70B in 14-day reverse repos, and CNY25B in 28-day reverse repos; injects net CNY40B for the week v CNY425B last week
- (AU) Australia sells A$900M in 5.5% 2023 bonds;avg yield 2.4328%; bid-to-cover 2.16x
Notable movers by sector:
- Consumer discretionary: Luk Fook 590.HK +3.7% (H1 result); Tatts Group TTS.AU +6.6%, Tabcorp TAH.AU +0.9% (enter into equity swap); Select Harvests SHV.AU +2.5% (guidance); HIS Co 9603.JP -4.6% (cuts guidance)
- Financials: KB Financial Group 105560.KR +0.7% (considers delaying Hyundai Savings sales); CYBG CYB.AU -2.6% (Numis cuts to sell); Ardent Leisure Group AAD.AU +4.4% (Dreamworld safety update); PICC Group 1339.HK +2.9%, China Life Insurance 2628.HK +2.8%
- Industrials: Codan CDA.AU +10.0% (guidance); Nissan Motor Co 7201.JP +3.1%, Mitsubishi Motors 7211.JP +5.6% (Oct result); Takata Corp.7312.JP +14.6% (acquisition speculation)
- Technology: Samsung Electronics 005930.KR -0.6% (speculation to sell PC business); MYOB Group MYO.AU +0.9% (guidance); Trend Micro 4704.JP -0.2% (Daiwa cuts to outperform)
- Materials: Resolute Mining RSG.AU -2.9%, Saracen Mineral Holdings SAR.AU -3.3% (gold declines)