Fortunately losses in Asia were more contained than in the States with indices there shaking off early lows. Energy names continued to lag as did Financials but at a considerably smaller impact than in the US. Caixin Service PMI readings were a much-needed relief, coming in at 53.8 vs the 50.7 estimate and 50.8 prior reading. The PMI reading in Hong Kong continued to slip, at 47.1 vs the prior 48.6. Service PMI in Japan held steady while GDP in the 3Q Down Under rose only .3% vs the +.6% QoQ reading expected.
Markets were somewhat relived by comments from WH Adviser Navarro as he stated it was too early to lose faith on trade talks and that is important to get it right. That was followed by China’s Commerce Ministry noting negotiations were pushing forward and were confident of trade talk results. They added agreed upon items would be implemented ASAP. (US soy and LNG imports are on that list). President Trump tweeted either a REAL DEAL with China will be completed or no deal with major tariffs to follow.
Real Estate names were lower but could have been considerably worse post comments from CK Asset executive director Chiu who noted HK home prices could collapse 25-30% this year if the trade war further worsens their economy. He also noted salaries have not kept pace with property price increases. CK Asset Holdings -.7%, Kerry Properties -1.3%. SCMP said the market in China could see a year of recession, this after November figures disappointed. China Evergrande saw November sales down 29% with Country Garden off 16% YoY.
- Orix -.3% will purchase Japan’s Cornes for ¥40B, this after announcing they will buy NTI Connect.
- 88% of shareholders agreed with Takeda’s +1.1% plan to purchase Shire.
- The BoJ upped their JGB purchases in the 10-25 year range to ¥200B from ¥180B.
- Investors are disappointed BAIC Motor -11.3% may see Daimler increase their stake to 65% from the current 49% as the the trade war sends firms to operate locally in Asia.
After opening lower indices in Europe have pared early losses but like Asia still remain lower on the session. Most sectors lag with Basic Resources off 1.5% while Energy, Construction, Media, and Industrials round out losers of a percent or more. Travel and Retail are managing slight gains. On the SXXP just under 200 names are up with volume flat on the session despite the US shut today in honor of President George HW Bush’s memorial service.
Markit Services PMI readings for the region are out with inline readings to small gains seen in many locales. The UK though disappointed with a 50.4 reading vs the 52.5 expectation and 52.2 prior result. New car registrations fell 3% after a like pullback last month.
- Bayer +1.2% at their Capital markets day said they see sales up 4% and earnings before interest, taxes, and depreciation up 9% through 2022. Stock buyback were called a “fantastic investment” with pharmaceutical R&D seen at 17% of sales.
- Transportation firm Stagecoach is ponying up gains of 13% today after their upped their FY eps view. RBC said the firm is optimizing their overall portfolio, not just their rail unit that reported strong performance.
- VW +.8% told President Trump they are considering using Ford’s capacity in the States to build vehicles with consideration concerning building another plant in the US. To the downside the firm said in a Tokyo press report that from August 2012 to June 2018 showed 7.5% of their vehicles had invalid test data.
|AU||21)||AiG Perf of Services Index||Nov||—||55.1||51.1||—|
|AU||22)||CBA Australia PMI Services||Nov F||—||53.7||52.6||—|
|AU||23)||CBA Australia PMI Composite||Nov F||—||53.9||52.9||—|
|JN||24)||Nikkei Japan PMI Services||Nov||—||52.3||52.4||—|
|JN||25)||Nikkei Japan PMI Composite||Nov||—||52.4||52.5||—|
|HK||26)||Nikkei Hong Kong PMI||Nov||—||47.1||48.6||—|
|AU||27)||GDP SA QoQ||3Q||0.60%||0.30%||0.90%||—|
|CH||29)||Caixin China PMI Composite||Nov||—||51.9||50.5||—|
|CH||30)||Caixin China PMI Services||Nov||50.7||53.8||50.8||—|
|IN||31)||Nikkei India PMI Services||Nov||—||53.7||52.2||—|
|IN||32)||Nikkei India PMI Composite||Nov||—||54.5||53||—|
|SW||33)||Maklarstatistik Swedish Housing Price Data|
|IR||34)||Investec Services PMI Ireland||Nov||—||57.1||57.2||—|
|IR||35)||Investec Composite PMI Ireland||Nov||—||56.6||56.1||—|
|NO||36)||Current Account Balance||3Q||—||91.8b||80.9b||79.1b|
|SW||37)||Swedbank/Silf PMI Services||Nov||—||62.2||56.3||56.4|
|SP||38)||Industrial Output NSA YoY||Oct||—||3.60%||-2.80%||-3.00%|
|SP||39)||Industrial Output SA YoY||Oct||-0.30%||0.80%||-0.10%||-0.20%|
|SP||40)||Industrial Production MoM||Oct||0.50%||1.20%||-0.70%||—|
|SP||41)||Markit Spain Services PMI||Nov||53.9||54||54||—|
|SP||42)||Markit Spain Composite PMI||Nov||53.3||53.9||53.7||—|
|SW||43)||Private Sector Production MoM||Oct||0.20%||1.10%||0.20%||0.40%|
|SW||44)||Private Sector Production YoY||Oct||2.40%||4.60%||2.00%||2.70%|
|SW||45)||Industry Production Value YoY||Oct||—||3.60%||2.20%||2.70%|
|SW||46)||Service Production Value YoY||Oct||—||5.90%||2.40%||3.60%|
|SW||47)||Industrial Orders MoM||Oct||—||1.00%||0.00%||0.60%|
|SW||48)||Industrial Orders NSA YoY||Oct||—||3.10%||-0.40%||0.40%|
|IT||49)||Markit/ADACI Italy Services PMI||Nov||49.3||50.3||49.2||—|
|IT||50)||Markit/ADACI Italy Composite PMI||Nov||49.1||49.3||49.3||—|
|FR||51)||Markit France Services PMI||Nov F||55||55.1||55||—|
|FR||52)||Markit France Composite PMI||Nov F||54||54.2||54||—|
|GE||53)||Markit Germany Services PMI||Nov F||53.3||53.3||53.3||—|
|GE||54)||Markit/BME Germany Composite PMI||Nov F||52.2||52.3||52.2||—|
|UK||55)||New Car Registrations YoY||Nov||—||-3.00%||-2.90%||—|
|IN||56)||RBI Repurchase Rate||5-Dec||6.50%||6.50%||6.50%||—|
|IN||57)||RBI Reverse Repo Rate||5-Dec||6.25%||6.25%||6.25%||—|
|IN||58)||RBI Cash Reserve Ratio||5-Dec||4.00%||4.00%||4.00%||—|
|EC||59)||Markit Eurozone Services PMI||Nov F||53.1||53.4||53.1||—|
|EC||60)||Markit Eurozone Composite PMI||Nov F||52.4||52.7||52.4||—|
|UK||61)||Markit/CIPS UK Services PMI||Nov||52.5||50.4||52.2||—|
|UK||62)||Markit/CIPS UK Composite PMI||Nov||52.1||50.7||52.1||—|
|UK||63)||Official Reserves Changes||Nov||—||$534m||$843m||—|
|EC||64)||Retail Sales MoM||Oct||0.20%||0.30%||0.00%||-0.50%|
|EC||65)||Retail Sales YoY||Oct||2.00%||1.70%||0.80%||0.30%|
|NO||66)||Norway House Price Report for November|
|IR||67)||Industrial Production MoM||Oct||—||0.00%||2.10%||2.90%|
|IR||68)||Industrial Production YoY||Oct||—||5.50%||6.70%||7.40%|