Equity markets generally improve
Asian Market Update: Equity markets generally improve; WTI Raw FUTs Extend Earnings; FUT UST prolong losses.
– GBP rises amid BOE comments.
– USD / JPY is trading at its highest level since late 2018 amid a recent rise in UST yields.
– Nikkei bounces after opening drop [Yen extends drop; Kishida played down tax concerns]; Topix Banks index supported by higher UST yields.
– Hang Seng has extended gain [TECH index rises after Meituan news; Lenovo drops on withdrawal of listing application] Real estate index lags, various CN / HK real estate developers in the headlines (Evergrande, Fantasia, Modern Land).
– Shanghai Composite remained slightly up.
– The S&P ASX 200 dropped after a flat opening [Star Entertainment weighs on Consumer Discretionary index].
– US equity FUTs decline after higher open.
Titles / Economic data
Australia / New Zealand
– ASX 200 open flat.
– Star entertainment [SGR.AU]: Responds to media reports regarding allegations.
– (AU) Reserve Bank of Australia (RBA) Offer to buy A $ 1.60 billion of government bonds against A $ 1.60 billion previously.
– (NZ) New Zealand Prime Minister Ardern: Need to maintain restrictions on coronaviruses longer; Auckland will remain in a level 3 lockout, to be reviewed in 1 week.
China / Hong Kong
– Hang Seng opened + 1.3%, Shanghai Composite + 0.2%.
– (CN) The Chinese State Council has declared that it calls for the energy supply to be assured; To allow electricity producers to increase industrial tariffs by 20% – financial press.
– Evergrande [3333.HK]: It seems that Evergrande’s offshore creditors’ advisers are preparing an emergency backup plan – press [Oct 8th].
– (CN) Chinese Vice Premier Liu He: China negotiates the cancellation of tariffs and sanctions; Exchange of views with USTR on trade deal – comments after Friday teleconference.
– (CN) China City Harbin (NE of China) to offer homebuyers up to CNY 100,000 subsidy for one purchase – China Daily.
– (CN) China Sec Journal: PBOC could renew MLF with larger amount in October to maintain reasonable credit and money supply growth [Note: PBOC normally conducts MLF operations around the 15th of the month].
– (CN) Funds raised by real estate trust companies in China fell> 40% m / m in September [amid issues related to Evergrande] – Shanghai Securities News.
– (CN) China PBOC Open Market Operation (OMO): Inject CNY10B in 7-day reverse repurchase agreements against CNY10B before; Net drain CNY190B v Net drain CNY320B before [Oct 11th].
– (CN) China PBOC Open Market Operation (OMO): Inject CNY10B in 7-day reverse repurchase agreements against CNY10B before; Net drain CNY320B v Net drain CNY330B before [Oct 9th].
– (CN) The Chinese PBOC fixes the benchmark rate of the yuan: 6.4479 against 6.4604 previously.
– Lenovo [992.HK]: withdraws its application for registration on the STAR board in Shanghai.
– Meituan [3690.HK]: Chinese market regulator fines Meituan CNY $ 3.4 billion for engaging in monopolistic behavior – press.
– Nikkei 225 opened -0.3%.
– (JP) Japan Chief Cabinet Sec Matsuno: will strengthen the tax system to increase wages first.
– Kospi is closed for holidays.
– (SG) Singapore PM: will allow vaccinated travelers from more countries, including the UK and US, to enter without quarantine.
– (US) Treasury Sec Yellen: confident that Congress will be able to raise the debt ceiling on December 3.
– (US) Senate Minority Leader McConnell sends letter to Pres Biden saying he will no longer provide Democrats with help to raise the US debt limit.
– (United States) Goldman Sachs analysts lowered US GDP growth forecasts for 2021 from 5.7% to 5.6%; Reduces US GDP growth forecast in 2022 from 4.4% to 4.0%.
– (US) Fed’s Daly (non-voting, dove): the labor market will experience ups and downs, especially with the Delta variant; It is too early to say that it is stalling.
– (United Kingdom) BOE Gov Bailey: inflation will be higher than our forecasts; Concerned that inflation is above target – press interview.
– (United Kingdom) Saunders of the BOE (QE dissident): households should prepare for an interest rate hike “significantly sooner” due to growing inflationary pressure – Interview with the British press.
– (UK) UK manufacturers of steel, glass, ceramics and paper have warned the government that unless something is done about rising wholesale gas prices they could stop the production.
– (UK) Brexit Min Frost is set to tell EU on Tuesday that ‘significant change’ to Northern Ireland protocol is vital for restoring genuine good relations between EU and UK – press .
– (UK) Chinese Customs: Import ban on British bovine beef under 30 months old due to a case of mad cow disease found in beef.
– (AT) Austria Chancellor Kurz resigns after pressure from his coalition partner, the Greens; proposes Foreign Minister Alexander Schallenberg as the next Prime Minister, will remain at the head of the party.
Levels at 1:20 ET
– Nikkei 225, + 1.5%, ASX 200 -0.3%, Hang Seng + 2.2%; Shanghai Composite + 0.5%; Kospi closed.
– S & P500 equity futures: -0.1%; Nasdaq100 -0.2%, Dax + 0.1%; FTSE100 flat.
– € 1.1579-1.1563; JPY 112.72-12.15; 0.7332-0.7291 AUD; 0.6947-0.6916 NZD.
– Flat gold at $ 1,757 / oz; Crude oil + 2% to $ 80.94 / brl; Copper + 0.2% at $ 4.2900 / lb.