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.
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.
|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||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||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|
|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||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||—|