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International Summary

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International Summary

"CAPIS Global Recap – 12/28/2018"

posted by Clayton Duff on 12/28/2018 at 6:46 am

by Clayton Duff

12/28/2018 at 6:46 am

Asian Headlines

Post the encouraging late-day rebound in the States Asian indices closed mostly higher with the Nikkei ending slightly lower on the session.  Japan saw Industrial Production weaken in November albeit less than expected while retail sales eased from better levels. Trading in Japan is done for 2018 with their market to not reopen until next Friday.  Industrial Production fell 1.7% in South Korea but the Kospi managed a small gain on the day.

From a meeting on the 20th the BoJ said they see global economic risks increasing adding yields should be allowed to be under zero at least temporarily. They added that inflation is not moving higher as expected with falling oil prices to delay achieving price targets.  At one point today the yield on their 10 year bond moved to zero.

Chinese indices finished up with Hong Kong flat ahead of official PMI readings due this weekend there.  Expectations are that Manufacturing will hold steady right at the expansion/contraction line with non-Manu holding at 53.2.  On the Shanghai, Consumer Staples led with alcohol producers rallying as Utilities and RE names finished better as well.  Energy slipped despite strength in crude.  To note, local press reported officials see FY18 industrial production growth pulling back to only +6.3% YoY.

Sinopec -5.1% again underperformed, hitting fresh 52 week lows.  On reports of large losses on crude oil futures trading at Unipec, Citi estimated a 7% hit to FY earnings using a $1B loss estimate.   CICC speculated losses could have been generated from put sells on crude.

Toshiba finished up 3.5% with a larger shareholder calling for ¥1.1T in share buybacks while also encouraging them to sell the TEC business.

European Headlines

European indices have steadily risen throughout the morning with solid gains seen throughout the region.  All sectors are up over a percent with almost half seeing gains of over two percent. Energy leads with the aforementioned strength in oil prices with Tech also strong.

German regional CPI readings are generally lighter than previous results ahead of the national view expected later this year. ECB banker Knot today seemed to dismiss the slowing of growth noting “a large part of the world economy is now operating at full capacity”.  He alluded to the fact that growth will ebb and flow and that while core inflation for the region is not on the upswing future QE moves should be restrained for deflationary moves only.

And speaking of Knot, he also today focused on the lack of AML oversight at banks adding they have minimized compliance costs to boost profits.  He highlighted ING +1.9%, stating they chose profit over compliance and risk management allowing criminal money to circulate throughout the economy.  Danske +2.1% and Deutsche Bank +3.6% have also faced AML concerns.

On light news headlines building material firm CRH +3% is up today on its commencement to repurchase €200M of shares.

Note that Monday France, the Netherlands, Belgium, Ireland, Italy, the UK, and Spain will be open a half day for trading with the balance of markets shut through Tuesday.  Switzerland will reopen Thursday.

Event Survey Actual Prior Revised
SK 13) Business Survey Non-Manufacturing Jan 72 74
SK 14) Business Survey Manufacturing Jan 71 71
SK 15) Industrial Production SA MoM Nov -0.20% -1.70% 1.00% 1.30%
SK 16) Industrial Production YoY Nov 1.40% 0.10% 10.70% 10.90%
SK 17) Cyclical Leading Index Change Nov -0.2 -0.4
JN 18) Job-To-Applicant Ratio Nov 1.63 1.63 1.62
JN 19) Jobless Rate Nov 2.40% 2.50% 2.40%
JN 20) Tokyo CPI YoY Dec 0.50% 0.30% 0.80%
JN 21) Tokyo CPI Ex-Fresh Food YoY Dec 0.90% 0.90% 1.00%
JN 22) Tokyo CPI Ex-Fresh Food, Energy YoY Dec 0.60% 0.60% 0.60%
JN 23) Japan Buying Foreign Bonds 21-Dec -¥312.2b ¥63.3b ¥107.3b
JN 24) Japan Buying Foreign Stocks 21-Dec -¥179.6b -¥63.0b
JN 25) Foreign Buying Japan Bonds 21-Dec -¥2205.0b ¥1607.4b ¥1627.9b
JN 26) Foreign Buying Japan Stocks 21-Dec -¥496.4b -¥166.9b -¥171.6b
JN 27) Industrial Production MoM Nov P -1.50% -1.10% 2.90%
JN 28) Industrial Production YoY Nov P 0.60% 1.40% 4.20%
JN 29) Retail Trade YoY Nov 2.10% 1.40% 3.50% 3.60%
JN 30) Retail Sales MoM Nov -0.40% -1.00% 1.20% 1.30%
JN 31) Dept. Store, Supermarket Sales Nov -0.40% -2.20% -0.80%
JN 32) Vehicle Production YoY Oct 6.30% -5.30% -5.30%
NE 33) Producer Confidence Index Dec 7.5 7.2
NO 34) Retail Sales W/Auto Fuel MoM Nov 0.80% 0.90% -0.20%
FI 35) House Price Index MoM Nov 0.70% -1.00%
FI 36) House Price Index YoY Nov 1.00% 0.40% 0.20%
SZ 37) KOF Leading Indicator Dec 98.8 96.3 99.1 98.9
GE 38) CPI Saxony MoM Dec 0.40% -0.10%
GE 39) CPI Saxony YoY Dec 1.90% 2.10%
SP 40) GDP QoQ 3Q F 0.60% 0.60% 0.60%
SP 41) GDP YoY 3Q F 2.50% 2.40% 2.50%
SP 42) CPI MoM Dec P -0.10% -0.40% -0.10%
SP 43) CPI YoY Dec P 1.50% 1.20% 1.70%
SP 44) CPI EU Harmonised MoM Dec P -0.10% -0.50% -0.20%
SP 45) CPI EU Harmonised YoY Dec P 1.60% 1.20% 1.70%
AS 46) PPI MoM Nov -0.30% 0.40%
AS 47) PPI YoY Nov 2.50% 3.40%
SW 48) Trade Balance Nov 4.9b -8.4b
GE 49) CPI Hesse MoM Dec -0.10% 0.30%
GE 50) CPI Hesse YoY Dec 1.40% 2.10%
GE 51) CPI Bavaria MoM Dec 0.00% 0.30%
GE 52) CPI Bavaria YoY Dec 2.20% 2.70%
NO 53) Norges Bank Daily FX Purchases Jan -350m -350m
SP 54) Current Account Balance Oct 0.3b 0.9b 0.7b
GE 55) CPI North Rhine Westphalia MoM Dec 0.00% 0.30%
GE 56) CPI North Rhine Westphalia YoY Dec 1.80% 2.40%
UK 57) UK Finance Loans for Housing Nov 38925 39403 39697 39640
GE 58) CPI Baden Wuerttemberg MoM Dec 0.00% 0.30%
GE 59) CPI Baden Wuerttemberg YoY Dec 2.00% 2.70%
PO 60) Industrial Production MoM Nov -2.40% -0.90% -0.50%
PO 61) Industrial Production YoY Nov -2.90% -0.30% -0.10%
PO 62) Retail Sales MoM Nov 1.60% 2.30% 2.80%
PO 63) Retail Sales YoY Nov 4.10% 5.60%
GE 64) CPI MoM Dec P 0.30% 0.10%
GE 65) CPI YoY Dec P 1.90% 2.30%
GE 66) CPI EU Harmonized MoM Dec P 0.40% 0.10%
GE 67) CPI EU Harmonized YoY Dec P 1.90% 2.20%

 

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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