Asia Market Update: Firmer Yuan fix and plunge protection response rescue China stocks; Samsung Electronics prelim Q4 misses estimates but grows on-year

***Economic Data***
- (CN) China Dec FX Reserves $3.33T v $3.44T prior; biggest decline on record (update)
- (AU) AUSTRALIA NOV RETAIL SALES M/M: 0.4% V 0.4%E
- (AU) AUSTRALIA DEC AIG PERFORMANCE OF CONSTRUCTION INDEX: 46.8 V 50.7 PRIOR; first contraction in 5 months
- (JP) JAPAN NOV LABOR CASH EARNINGS Y/Y: 0.0% V 0.7%E; REAL EARNINGS (EX-INFLATION) Y/Y: -0.4% V 0.4% PRIOR
- (JP) JAPAN DEC OFFICIAL RESERVE ASSETS: $1.23T V $1.23T PRIOR

***Index Snapshot (as of 04:30 GMT)***
- Nikkei225 +0.1%, S&P/ASX -0.4%, Kospi +0.2%, Shanghai Composite +1.5%, Hang Seng +1.1%, Mar S&P500 +1.0% at 1,952

***Commodities/Fixed Income***
- Feb gold -0.4% at $1,103/oz, Feb crude oil +1.9% at $33.91/brl, Mar copper +0.2% at $2.03/lb
- GLD: SPDR Gold Trust ETF daily holdings fall 4.1 tonnes to 645.1 tonnes; first rise since Dec 22
- SLV: iShares Silver Trust ETF daily holdings fall to 9,840 tonnes from 9,884 tonnes; lowest since Nov 15th
- (US) Weekly Fed Balance Sheet Total Assets for week ending Jan 6th: $4.49T v $4.49T prior; Reserve Bank Credit: $4.45T v $4.45T prior

***Market Focal Points/FX***
- Concerns over aggressive currency devaluation by the PBoC, which infected markets throughout the globe over the past 24 hours, have been eased at least temporarily. Policymakers in Beijing have taken note of investor response to their moves on both FX and stocks, as they scrapped the controversial 7% circuit breaker halt for CSI 300 index overnight. Subsequently, in spite of reports that the PBoC under increasing pressure to devalue by an even more aggressive 10-15%, the central bank actually firmed up the midpoint fix for the first time in 9 trading days, producing a powerful short-covering rally. Shanghai Composite opened by over 2% moved even higher, then fell 2% in morning hours, and have since returned from the lunch break to rise by just over 2.5%. Reported measures by Chinese plunge protection team continue to support the rebound, with FX regulator SAFE rumored to have ordered banks to limit their USD purchases that weaken Yuan. Other reports suggest the authorities also directly intervened to help support the stock market in today's session. Other markets have rebounded as well - US equity futures are up about 1%, USD/JPY spiked up some 100pips above 118.50 on Yuan fix, Oil is up 2%, while gold and silver are down. In other FX majors, EUR/USD fell as much as 70pips from late US session highs to 1.0870s and AUD/USD was up 70pips above 0.7070 in the aftermath of stronger CNY midpoint.

- Among key speakers, China Premier Li noted the govt is also working to reduce overproduction and overcapacity in iron, coal, and steel industries. Asian Development Bank (ADB) Pres Nakao reflected on Yuan volatility as being market-driven rather than artificially devalued, expressing skepticism of China engaging in a currency war. Japan cabinet officials Aso and Amari both stated that domestic economy is holding up well and the recent decline was the product of external factors, while BOJ's Kuroda pledged to keep easing until 2% inflation target is achieved.

- Notable economic data included Australia retail sales that came in line and had little impact on the market, even though analysts noted the modest rise held up due to seasonal restaurant spending. Overnight, China FX reserves showed the biggest monthly decline on record, which likely underscored the urgency behind China policymakers efforts. Saber-rattling on the Korean peninsula also continued in the wake of the nuclear test claim by the North, as Seoul began anti-North Korea propaganda broadcasts at border points. Recall in August, North Korean official threatened military action if the South continued to broadcast anti-Pyongyang messages.

***Equities***
US equities / ADRs:
- RT: Reports Q2 -$0.26 v -$0.15 y/y, R$261M v $263M y/y; +4.6% afterhours
- URBN: Reports Holiday Sales; Nov-Dec SSS -2%; +2.4% afterhours
- BBBY: Reports Q3 $1.09 v $1.09e, R$2.95B v $2.98Be; -1.9% afterhours
- CRUS: Guides Q3 R$347M v $385Me; cites weaker than anticipated demand for certain portable audio products; -4.9% afterhours
- GPS: Reports Dec SSS -5.0% v -3.5%e; -8.6% afterhours
- CUDA: Reports Q3 $0.07 v $0.08e, R$80.1M v $80.6Me; -17.4% afterhours
- TCS: Reports Q3 -$0.04 (incl items) v $0.05e, R$197.2M v $199Me; -19.5% afterhours

Key movers in Asia
- Samsung Electronics 005930.KR: Reports prelim Q4 Op profit KRW6.1T (v KRW5.3T y/y) v KRW6.6Te, Rev KRW53.0T (v KRW52.7T y/y) v KRW53.5Te; +0.4%
- Lenovo 992.HK: Chairman: To continue dual-brand strategy; Will explore overseas markets under Lenovo and Motorola brand - Chinese press; +4.0%
- BHP: Macquarie Cuts BHP to Neutral from Outperform, price target: A$16.30; +0.1%
- CIM.AU: Awarded Christchurch contract expected to generate sales of NZ$300M; +1.3%
- SGH.AU: Creditors have appointed investigative accountants to parse company's books; -4.8%
- 9983.JP: Reports Q1 Net ¥48.0B v ¥68.8B y/y, Op profit ¥75.9B v ¥91.4B y/y, Net ¥520B v ¥480B y/y; Cuts FY target -2.8%
- 3382.JP: Reports 9-month Net ¥125.4B v ¥127.3B y/y, Op Profit ¥261.0B v ¥249.5B y/y, Rev ¥4.51T v ¥4.50T y/y; -3.1%