Mixed returns overnight with China and Hong Kong finishing lower while the balance of markets finished up small. Despite this weekend’s strike on Syria oil prices are lower today with Energy names underperforming in most markets. Health Care, Consumer Staples, and Utilities led in Japan while all sectors fell in Hong Kong with Autos and Casinos weighing. The mainland saw the RE sector lower by 3% while Financials and Telcos were not far behind.
The weakness in Real Estate in China was post in an uptick in the 14 day reverse repo rate to 2.70% from 2.65% with CNY150B injected today. Several local analysts noted apartment developers are offloading units quickly as they see slowing activity with prices expected to fall. Upcoming property taxes are also in focus with China Vanke -4.3% and Country Garden -3.9%. Casino names also fell with the country to support horse racing and sports lotteries in Hainan, the southernmost and smallest province of China. However analysts from Morgan Stanley and Goldman noted they do not see casino gaming allowed anytime soon there. They added that the limited competition along with higher demand and a better infrastructure should portend to better industry health ahead. Russian aluminum producer Rusal’s stock fell another 30% today with tensions and possibly further sanctions on the upswing between the US and Russia. Tonight China will release a slew of data including GDP, Industrial Production, and Retail Sales. Of interest, China has halted the review of 110 companies seeking to IPO.
HK’s Financial Secretary expressed they were not too concerned with the HK$ noting they can deal with capital outflows. SCMP reported the country has intervened 4 times recently to support their currency.
In Japan the Nikkei reported companies there have upped wages by an average of 2.41% thus far this year which is the largest increase in 20 years. Leaders between Japan and China met this week to discuss North Korea with ties between the two seeming to improve.
Takeda’s +2.1% Weber will meet with several large holders of Shire in the US this weekend to attempt to woo them to approve a takeover.
Sega Sammy +4.4% rallied with one broker seeing better casino and video game revenues ahead. The Paradise City casino in Korea has made progress in revenues with hopes growing for Japanese gaming locales.
European indices have held steady today with little in the way of moves away from flat. Travel and Retail names are up slightly with Food and Energy down less than a percent. Volume is running over 20% slower with markets in Europe appearing to shake off this weekend’s missile strike as well.
Of concern for Takeda is heavy cost to acquire Shire +.9% with the UK-listed pharma worth £7B more than Takeda. Shire’s £19B in debt is in focus but the load appears to be made a little more palatable today with Shire % to sell their Oncaspar oncology business to Frances’ Servier for $2.4B. Shire said depending on what Takeda does they are consider a stock buyback with the proceeds.
WPP -5.1% lower today after CEO Sorrell turned in his resignation this weekend. The company’s founder quit ahead of the upcoming results of an internal investigation into whether he conducted personal misconduct and misused company assets. Concerns for the complex company now are that it may be broken up with over 400 agencies making up the firm.
With Elliot Advisors reporting a 5.3% stake, Whitbread +7.1% trades higher today. The Financial Times reported the money manager has presented a plan to the company to split its Premier Inn and Costa Coffee units.
This weekend Marine Harvest -1.4% reported they see the 1Q will yield 81K tons of catch vs the 82.5K expected. Operational EBIT is seen at €155M.
|UK||2)||Rightmove House Prices YoY||Apr||—||1.60%||2.10%||—|
|IR||3)||Ulster Bank Ireland Construction PMI||Mar||—||57.5||59.2||—|
|JN||4)||Tokyo Condominium Sales YoY||Mar||—||6.10%||7.80%||—|
|SW||5)||Maklarstatistik Swedish Housing Price Data|
|GE||6)||Wholesale Price Index MoM||Mar||—||0.00%||-0.30%||—|
|GE||7)||Wholesale Price Index YoY||Mar||—||1.20%||1.20%||—|
|NO||10)||Trade Balance NOK||Mar||—||15.0b||21.3b||21.1b|
|IN||11)||Wholesale Prices YoY||Mar||2.43%||2.47%||2.48%||—|
|SZ||20)||Producer & Import Prices MoM||Mar||—||-0.20%||0.30%||—|
|SZ||21)||Producer & Import Prices YoY||Mar||—||2.00%||2.30%||—|
|SZ||22)||Total Sight Deposits CHF||13-Apr||—||575.1b||574.9b||—|
|SZ||23)||Domestic Sight Deposits CHF||13-Apr||—||466.2b||465.4b||—|
|CC||24)||CPI Harmonized YoY||Mar||—||-0.40%||-0.40%||—|
|CC||25)||CPI Harmonized MoM||Mar||—||0.90%||1.20%||—|
|BE||26)||Budget Balance YTD||Mar||—||-10.631b||-4.520b||—|