Following the solid advance in the States, the region gained. The mainland Chinese markets lagged following mixed macroeconomic data. August retail sales were ahead of expectations and industrial production was inline. Fixed asset investment raised concerns missing consensus and hitting new multi-year lows. (All figures in our macro section below.)
Despite the down tick in China, most sectors traded to the upside across the region. IT and consumer discretionary gained more than 1%. Apple suppliers helped provide the uptick in IT. The Macau gaming sector was ante’d up following bullish comments from Morgan Stanley. They noted if the sector followed a previous historical pattern, it has 50.0% upside.
Other Important Headlines
- Sun Hung Prop +2.2% traded well following yesterday’s post close earnings that saw FY NI c. 2.6% ahead of estimates. That was a 17.0% y/y increase and the company made upbeat comments regarding the current FY.
- Takeda Pharma +0.7% saw a sharp decline in credit default swaps. The company is contemplating the sale of Shire’s +2.6% eye care unit. Projections indicate that could raise c. $5b offsetting come of the angst surrounding the merger. Separately, China gave its thumbs up to the deal.
- Fujifilm +4.6% snapped to its highest level in four years as JPMorgan raised the stock to overweight. The broker believes its instant film cameras will overtake digital compact cameras.
Europe has been trading to the upside since the open. The region hit a high of c. 0..5% but then pared some of the gains. Most sectors have been in the green. Autos were up more than 1% earlier but have given back some of the advance. Currently, they lead along with basic resources on gains of more than 0.5%. Retail, banks and health care are down small.
- UK builders lag following comments from BoE Gov. Carney. While discussing the impact of a No-Brexit deal scenario, Mr. Carney warned it may result in housing price declines of more than 35.0%!
- Investec +7.5% has leapt to the top of the Euro Stoxx 600. While reporting H1 results, the company also announced it will spin-off its asset management unit. It will be dual listed in London and Johannesburg.
- The FDA approved AstraZeneca’s -0.6% Lumoxitil to treat a form of leukemia.
On Our Side of the Pond
- Goldman Sachs announced a number of changes to its C level executives.
- Later yesterday, Peru’s central bank left is reference rate at 2.75%.
To all in the path of Florence, while the storm weakened, you remain in our thoughts and prayers. A good and safe weekend to all.
Markets and Macro Data
|SK||Import Price Index YoY||Aug||—||10.00%||12.20%||—|
|SK||Import Price Index MoM||Aug||—||-0.20%||1.70%||—|
|SK||Export Price Index YoY||Aug||—||2.10%||2.60%||2.80%|
|SK||Export Price Index MoM||Aug||—||-0.10%||2.30%||2.50%|
|CH||Surveyed Jobless Rate||Aug||—||5.00%||5.10%||—|
|CH||Bloomberg Sept. China Economic Survey (Table)|
|CH||Retail Sales YoY||Aug||8.80%||9.00%||8.80%||—|
|CH||Retail Sales YTD YoY||Aug||9.30%||9.30%||9.30%||—|
|CH||Industrial Production YoY||Aug||6.10%||6.10%||6.00%||—|
|CH||Industrial Production YTD YoY||Aug||6.50%||6.50%||6.60%||—|
|CH||Fixed Assets Ex Rural YTD YoY||Aug||5.60%||5.30%||5.50%||—|
|JN||Industrial Production MoM||Jul F||—||-0.10%||-0.10%||—|
|JN||Industrial Production YoY||Jul F||—||2.20%||2.30%||—|
|JN||Capacity Utilization MoM||Jul||—||-0.60%||-2.20%||—|
|IN||Wholesale Prices YoY||Aug||4.62%||4.53%||5.09%||—|
|IT||CPI EU Harmonized YoY||Aug F||1.70%||1.60%||1.70%||—|
|IT||CPI FOI Index Ex Tobacco||Aug||103||102.9||102.5||—|
|IT||General Government Debt||Jul||—||2341.7b||2323.3b||2323.3b|
|EC||Trade Balance SA||Jul||16.2b||12.8b||16.7b||16.5b|
|EC||Trade Balance NSA||Jul||—||17.6b||22.5b||—|
|EC||Labour Costs YoY||2Q||—||2.20%||2.00%||2.10%|
|US||Retail Sales Advance MoM||Aug||0.40%||—||0.50%||—|
|US||Retail Sales Ex Auto MoM||Aug||0.50%||—||0.60%||—|
|US||Retail Sales Ex Auto and Gas||Aug||0.50%||—||0.60%||—|
|US||Retail Sales Control Group||Aug||0.40%||—||0.50%||—|
|US||Import Price Index MoM||Aug||-0.20%||—||0.00%||—|
|US||Import Price Index ex Petroleum MoM||Aug||-0.20%||—||-0.10%||—|
|US||Import Price Index YoY||Aug||4.10%||—||4.80%||—|
|US||Export Price Index MoM||Aug||0.00%||—||-0.50%||—|
|US||Export Price Index YoY||Aug||—||—||4.30%||—|
|US||Industrial Production MoM||Aug||0.30%||—||0.10%||—|
|US||Manufacturing (SIC) Production||Aug||0.30%||—||0.30%||—|
|US||U. of Mich. Sentiment||Sep P||96.6||—||96.2||—|
|US||U. of Mich. Current Conditions||Sep P||—||—||110.3||—|
|US||U. of Mich. Expectations||Sep P||—||—||87.1||—|
|US||U. of Mich. 1 Yr Inflation||Sep P||—||—||3.00%||—|
|US||U. of Mich. 5-10 Yr Inflation||Sep P||—||—||2.60%||—|