Asia Mid-Session Market Update: Japan data perks up; China CBRC official proposes a RRR cut at an "appropriate time"
***US Session Highlights***
- Despite the holidays winding down, the festive mood continued on Wall Street, as stocks put in another positive day. The DJIA continued to flirt with 20,000, reaching a day high of 19977.50.
- Big boost in today's Consumer Confidence number, released at 113.7 against expected 109.0, compared to a previous 109.4. Post-election bullishness of stock market transferring also to consumers on the street.
- House prices continued to grow this month at a slightly faster pace than last month;S&P/Case Shiller: house market showing some vigor despite a recent rate increase, and prospects for future increases on the horizon were not able to dent demand.
- US Yields continue to rise in today's auction for T-Bills and particularly in 2-Year Treasury-Notes.
***US markets on close: Dow +0.06%, S&P500 +0.22%, Nasdaq +0.45%***
- Best Sector in S&P500: Materials
- Worst Sector in S&P500: Telecommunication
- Biggest gainers: NVDA +6.9%; FSLR +4.2%; CF +4.0%
- Biggest losers: MNK -2.7%; ENDP -2.3%; MAT -1.8%
- At the close: VIX 11.98 (+0.55pts); Treasuries: 2-yr 1.23% (+0.025bps), 10-yr 2.56% (+0.022bps), 30-yr 3.136% (+0.026bps)
***US movers afterhours***
- MDXG: EpiFix receives coverage from Aetna; +1.8% after hours
- ANTH: Phase 3 SOLUTION Study with Sollpura in cystic fibrosis misses primary endpoint but demonstrates encouraging results; -63.2% after hours
- GLBL: Knighthead Capital Management, LLC discloses 6.43% stake - 13D filing; +2.5% after hours
***Key economic data***
- (JP) JAPAN NOV RETAIL SALES M/M: +0.2% V -0.5%E; RETAIL TRADE Y/Y: 1.7% V 0.8%E
- (JP) JAPAN NOV PRELIMINARY INDUSTRIAL PRODUCTION M/M: 1.5% V 1.7%E; Y/Y: 4.6% V 4.7%E
- (VN) VIETNAM Q4 GDP: 6.68% v 6.56% prior; YTD Y/Y: 6.21% V 6.30% PRIOR; 2016 GDP 6.3% v 6.30%E v 6.68% in 2015
- (JP) JAPAN NOV VEHICLE PRODUCTION Y/Y: +6.6% V -3.9% PRIOR
- (HK) Macau Nov Visitor Arrivals: 2.59M v 2.68M prior; flat y/y
***Asia Session Notable Observations, Speakers and Press***
- Trade remains mixed and light even with all markets open following a very quiet US session, which again saw higher crude prices.
- Japan 20-yr JGB yield rose 0.5bps to 0.58% as Japan reduces purchases of super long debt. BOJ offers to buy ¥190B in 10-25yr JGBs v ¥200B prior and ¥110B in JGBs with maturity over 25-yr v ¥120B prior
- (CN) China Banking Regulatory Commission (CBRC) Official: Proposes RRR cut at an "appropriate time" - Chinese press
- WOW.AU: Woolworths confirms A$1.79B sale of Woolworths petrol stations to BP
- (CN) China Q4 Beige Book: Saw improvement q/q in Rev, profits, CAPEX and jobs; New orders stable q/q
- (CN) China to raise gasoline prices by CNY95/ton, diesel prices by CNY90/ton; effective tomorrow
- (CN) China Jan-Nov SOE Profit CNY2.11T, +2.8% y/y; Rev CNY40.8T, +2.4% y/y
- Coking coal prices fall amid China output increasing
- Toshiba, 6502.JP: Shares trade limits down -20% after it confirmed yesterday it may have to write down US nuclear operations
***Asian Equity Indices/Futures (00:00ET)***
- Nikkei +0.2%, Hang Seng +0.1%, Shanghai Composite -0.3%, ASX200 +0.9%, Kospi -0.7%
- Equity Futures: S&P500 +0.1%; Nasdaq +0.2%, Dax +0.1%, FTSE100 +0.02%
***FX ranges/Commodities/Fixed Income (00:00ET)***
- EUR 1.0455-1.0475; JPY 117.37-117.74; AUD 0.7182-0.7208; NZD 0.6889-0.6927
- Feb Gold +0.32% at 1,142/oz; Feb Crude Oil -0.26% at $53.77/brl; Mar Copper +0.25% at $2.52/lb
- GLD: SPDR Gold Trust ETF daily holdings fall 1.18 tonnes to 823.36 tonnes
- USD/CNY: (CN) PBOC SETS YUAN MID POINT AT 6.9495 V 6.9462 PRIOR
- (CN) PBOC to inject combined CNY100B in 7-day, 14-day and 28-day reverse repo operation vs. CNY80B prior
- USD/CNY: Has traded in a 151 pip range from Dec 21st-28th v 630 pip range from Dec 14-21st; suggesting PBOC is trying to stabilize heading into the end of the year
***Asia equities / Notables / movers by sector***
- Consumer discretionary: J.Front Retailing 3086.JP -4.4% (CLSA cuts to sell); Kao Corp 4452.JP -0.6% (venture in Indonesia); Toray Industries 3402.JP -2.2% (9-month result speculation); Panasonic Corporation 6752.JP +0.6% (Tesla and Panasonic to start solar module output); Takashimaya Co 8233.JP -4.4% (9-month result); Super Retail Group SUL.AU +2.7% (Morgans Financial raised to add)
- Consumer staples: Woolworths WOW.AU +2.1% (sales of gas stations); Mengniu Dairy 2319.HK +2.0% (shakes off compensation ruling)
- Financials: SBI Holdings 8473.JP +0.3% (in talks to form JV)
- Industrials: Hitachi 6501.JP +1.4% (unit takeover speculation); Riyue Heavy Industry 603218.CN +44% (IPO debut); Nippon Shokubai Co. 4114.JP -0.4% (may cut pretax profit target)
- Technology: Toshiba Corporation 6502.JP -20.4% (weighing nuclear writedown); Hitachi Kokusai Electric 6756.JP +4.8%; Hikari Tsushin 9435.JP +1.3% (share buyback)
- Materials: South32 S32.AU +2.9% (NSW approval for expansion)
- Energy: Caltex Australia CTX.AU -2.2% ( Woolworth sells fuels business to BP); JX Holdings 5020.JP +0.9% (Nomura raised to buy)
- Utilities: Ebara Corp 6361.JP +2.9% (Tokai Tokyo Financial raised to outperform)