05.24.2019 16 new International Summary posts under Morning Note (10) and International Summary (6)

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International Summary

"CAPIS Global Recap – 11/15/2018"

posted by Clayton Duff on 11/15/2018 at 6:45 am

by Clayton Duff

11/15/2018 at 6:45 am

Asian Headlines

Gains today were focused in China/Hong Kong as well as Korea while Japan and Australia saw tepid moves on the session.  Helping buoy the local Chinese markets expectations are for a RRR cut of 50bps to be enacted this quarter per local press reports.  Also, as per reported yesterday the government has responded with trade concessions to the US with no guidance at this point to the specifics. To the downside China’s NDRC said they are Not looking into reducing the auto purchase tax.

On the Shanghai all sectors rallied with IT names there higher, fueled by gains in Hong Kong-listed Tencent+5.8%.  Post yesterday’s strong earnings report one local broker upped the name to Buy but several US brokers expressed concern the lack of clarity concerning new video game releases in light of the country’s non-approval of new games.  Mogu, a fashion firm backed by Tencent, pared their US IPO offering valuation in light of weakness in the tech space.

Energy lagged in Japan along with Financials with oil names though leading in Australia. Down Under, employment readings for October were encouraging with full-time employment on the upswing.  On the central bank front both Indonesia and the Philippines upped their benchmark rates, to 6.00% and 4.75% respectively.

  • Samsung-related companies fell with the group’s biotech unit, Samsung Biologics, being halted today.  The firm allegedly broke accounting rules involving its IPO.  Expectations are that it will not be delisted which would have a large affect on investors as it is the 5th largest member on the Kospi.
  • ICBC +.9% yesterday pulled a 3/5 year, USD-denominated floating rate note offering from their US branch with little interest shown from US buyers.  The highly rated issuance was priced attractively, inline with lower rated issuers but US investors are evidently shying away from China to some extent.
  • Toshiba +3.7% ticked up on further stock buybacks.

European Headlines

Today’s focus has been on Brexit with several resignations reducing chances of a deal being passed in Parliament.  Markets originally opened higher but have since turned lower with losses though slight.  Chemicals and Food names join Basic Resources which led on solid gains early in the session.  The balance of names are down, led lower by Travel, Retail, and Autos.

In Great Britain, UK Brexit Minister Raab has resigned today noting he could not support the indefinite backstop portion of the deal. Several other ministers have also quit in disgust of the deal. While the deal was agreed upon in the Cabinet meeting it has yet to pass in the Parliament.   PM May though is further feeling the heat with letters being produced to force a confidence vote which could occur today.

The FTSE is up slightly with the Pound taking a sharp leg lower, to under 1.28. Materials, Health Care, and Staples are better but RE, Utilities, Discretionarys, and Financials weigh.  The Pound move is

  • Recent IPO Aston Martin Lagonda -5.7% is off despite highlighting they see FY18 sales a the top end of guidance.  Their CEO said the industry “sighed a breath of relief” as PM May’s deal delivers tariff-free borders.
  • Bouygues +1% confirmed FY views post a 6% rise in 9M sales.
  • Car rental firm Sixt +3.5% better post a slightly better expectation in FY Ebitda.
  • UK banks: Barclays -4.2%, Lloyds -4.6%, RBS -6.7% on Raab resignation, Brexit deal on edge, PM May possibly out.
  • Automakers down with European27 October new vehicle sales down 7.4%. UK retailers weak on disappointing October retail sales #’s.

Event Survey Actual Prior Revised
JN 57) Housing Loans YoY 3Q 2.40% 2.70%
JN 58) Japan Buying Foreign Bonds 9-Nov ¥1620.8b -¥167.3b -¥167.4b
JN 59) Japan Buying Foreign Stocks 9-Nov -¥203.9b ¥463.7b ¥470.2b
JN 60) Foreign Buying Japan Bonds 9-Nov ¥413.3b ¥547.4b ¥545.4b
JN 61) Foreign Buying Japan Stocks 9-Nov ¥360.9b ¥107.6b ¥107.4b
AU 62) Consumer Inflation Expectation Nov 3.60% 4.00%
AU 63) Employment Change Oct 20.0k 32.8k 5.6k 7.8k
AU 64) Unemployment Rate Oct 5.10% 5.00% 5.00%
AU 65) Full Time Employment Change Oct 42.3k 20.3k 24.6k
AU 66) Part Time Employment Change Oct -9.5k -14.7k -16.8k
AU 67) Participation Rate Oct 65.50% 65.60% 65.40% 65.50%
AU 68) RBA FX Transactions Market Oct A$450m A$640m
AU 69) RBA FX Transactions Government Oct -A$542m -A$801m
AU 70) RBA FX Transactions Other Oct -A$3906m A$1719m
CH 71) New Home Prices MoM Oct 1.02% 1.00%
JN 72) Tokyo Condominium Sales YoY Oct 2.80% 13.20%
SW 73) Valueguard Swedish Home-Price Data
NE 74) Unemployment Rate Oct 3.70% 3.70%
DE 75) PPI YoY Oct 6.10% 5.80%
DE 76) PPI MoM Oct 0.80% -0.50%
NO 77) Trade Balance NOK Oct 34.9b 21.1b 22.2b
CH 78) Foreign Direct Investment YoY CNY Oct 7.20% 8.00%
FI 79) Current Account Balance Sep 0.10b -0.10b -0.25b
EC 80) EU27 New Car Registrations Oct -7.30% -23.50%
SW 81) Unemployment Rate Oct 6.10% 5.50% 6.00%
SW 82) Unemployment Rate Trend Oct 6.30% 6.50% 6.30%
SW 83) Unemployment Rate SA Oct 6.40% 6.00% 6.50%
UK 84) Retail Sales Ex Auto Fuel MoM Oct 0.20% -0.40% -0.80% -0.30%
UK 85) Retail Sales Ex Auto Fuel YoY Oct 3.40% 2.70% 3.20% 3.60%
UK 86) Retail Sales Inc Auto Fuel MoM Oct 0.20% -0.50% -0.80% -0.40%
UK 87) Retail Sales Inc Auto Fuel YoY Oct 2.80% 2.20% 3.00% 3.30%
IT 88) General Government Debt Sep 2331.3b 2326.5b 2326.6b
EC 89) Trade Balance SA Sep 16.3b 13.4b 16.6b 16.8b
EC 90) Trade Balance NSA Sep 13.1b 11.7b
IR 91) Trade Balance Sep 2963m 3696m 3625m
BE 92) Trade Balance Sep -929.3m

About the Author

ClaytonDuffFVP,Senior International Trader

Clayton Duff joined the firm in 2008. He has worked in the industry since 1994 and held various trading and sales positions before CAPIS, including four years as a trader for First Southwest. He earned his bachelor’s degree from the University of Texas Arlington. Clayton maintains Series 3,...

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