Back to the civilisation but not yet to the office
Asia Mid-Session Market Update: PBoC Yuan fix at new multi-year lows; RBA minutes cautious on China outlook and uncertain labor despite signs of improvement
***US Session Highlights***
- (US) NY Fed Consumer Expectations survey: 1-year US inflation expectations edged higher in Oct; 3-year inflation expectations unchanged
- (US) S&P cuts New Jersey GO bonds one notch to A- from A; outlook Negative
- (US) Fed's Kaplan (moderate, non-voter): we need to find opportunities to raise rates; the time for monetary policy in the US is coming to an end
- MENT: To be acquired by Siemen's for $37.25/shr in cash; valued at $4.5B
- HAR: To be acquired by Samsung Electronics for $112/shr cash; deal valued at $8.0B
- UPS: Airline maintenance technicians represented by Teamsters authorize a strike at UPS
***US markets on close: Dow +0.1%, S&P500 flat, Nasdaq -0.4%***
- Best Sector in S&P500: Financials
- Worst Sector in S&P500: Technology
- Biggest gainers: HAR +25.2%, SWN +9.3%, SNI +7.6%, DISCAN +7.2%, RF +6.7%
- Biggest losers: TDG -7.1%, PVH -5.7%, KORS -5.1%, NVDA -4.9%, EW -4.8%
- At the close: VIX 14.5 (+0.3pts); Treasuries: 2-yr 1.00% (+9bp), 10-yr 2.22% (+10bps), 30-yr 2.98% (+5bps)
***US movers afterhours***
- AAP: Reports Q3 $1.73 v $1.72e, R$2.25B v $2.20Be; +12.6% afterhours
- EGLE: Announces Acquisition of SDARI-64 Ultramax Newbuilding Vessel; +8.2% afterhours
- ALRM: Reports Q3 $0.19 v $0.11e, R$67.8M v $59.8Me; names Steve Valenzuela new CFO, effective Nov 15th; +5.0% afterhours
- PIR: Guides Q3 at high end of previously guided ranges for sales and earnings (implies high end of EPS $0.09-0.15 v $0.10e, SSS -3% to -1%); +4.6% afterhours
- ZOES: Reports Q3 $0.04 v $0.04e, R$67.3M v $68.1Me; -4.8% afterhours
- BETR: Reports Q3 $0.12 v $0.15e, R$68.0M v $64.7Me; -11.2% afterhours
***Asia Session Notable Observations, Speakers and Press***
- USD consolidates week-long gains as expectations for December rate hike approach 90% and those for at least 2 more hikes next year reach about 25%.
- Oil under more pressure with reports of OPEC remaining divided on output cuts.
- US Pres Obama holds first press conference since the elections; Committed to ensuring a smooth transition for President-elect Trump; Says Trump is committed to NATO relationship; Amid speculation over Trump cabinet appointments, Giuliani said to be in the running for State Sec and not interested in AG post.
- PBoC sets Yuan midpoint at weakest level since late 2008; Offshore Yuan falls through CNY6.87 - a multi-year low.
- RBA meeting minutes reiterate the risks around inflation forecast are broadly balanced; Acknowledging improving trade conditions but still sees uncertainty about outlook due to China; Uncertainty around labor market conditions also remains going into this weeks employment data.
***Asia Key economic data:***
- (NZ) NEW ZEALAND OCT PERFORMANCE OF SERVICES INDEX: 56.3 V 54.2 PRIOR
- (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence Index: 118.2 v 117.8 prior
- (ID) Indonesia Oct Trade Balance: $1.2B v $1.1Be
- (SG) SINGAPORE SEPT RETAIL SALES M/M: -0.7% V +0.3%E; Y/Y: 2.0% V 2.0%E
- (TH) Thailand Oct Unemployment Rate y/y: 1.2% v 0.9% prior
***Asian Equity Markets (00:00ET)***
- Nikkei flat, Hang Seng +0.4%, Shanghai Composite -0.3%, ASX200 -0.3%, Kospi flat
***FX ranges/Commodities/Futures/Fixed Income (00:00ET):***
- EUR 1.0735-1.0770; JPY 107.80-108.40; AUD 0.7550-0.7580; NZD 0.7100-0.7140
- Dec Gold +0.2% at 1,224/oz; Dec Crude Oil +2.0% at $44.20/brl; Copper +0.5% at $2.53/lb
- GLD: SPDR Gold Trust ETF daily holdings fall 5.7 tonnes to 928.9 tonnes; lowest since June
- SLV: iShares Silver Trust ETF daily holdings fall to 11,080 tonnes from 11,095 tonnes prior; lowest since Aug 21st
- Equity Futures: S&P e-mini +0.2%, Dax +0.3%, FTSE100 +0.2%
- USD/CNY: (CN) PBOC SETS YUAN MID POINT AT 6.8495 V 6.8291 PRIOR; weakest Yuan setting since Dec 2008
- JGB: (JP) Japan MoF sells ¥2.17T in 0.1% 5-year JGB bonds; avg yield -0.160% v -0.201% prior; bid-to-cover 3.56x v 4.31x prior
Notable movers by sector:
- Consumer discretionary: Mantra Group MTR.AU +4.8% (new CFO); Dentsu Inc 4324.JP -7.0% (9-month result); Hokuetsu Kishu Paper Co 3865.JP -7.9% (H1 result)
- Financials: OzForex Group OFX.AU -15.9% (H1 result); Sumitomo Mitsui Trust Holdings 8309.JP +3.6% (H1 result); Mitsubishi UFJ Financial Group 8306.JP +4.9% (H1 result); Sumitomo Mitsui Financial Group 8316.JP +3.8% (H1 result)
- Industrials: Takeuchi Manufacturing Co 6432.JP +3.5%
- Technology: Sun King Power Electronics Group 580.HK +3.4% (guidance)
- Materials: OZ Minerals OZL.AU +5.3% (to extend Prominent Hill mine life); Zhejiang Dongliang New Building Materials Co 002082.CN +10.0% (shareholder to increase stake); New Hope Corporation NHC.AU -3.0% (guidance); Yokohama Rubber Co 5101.JP +3.7% (9-month result)