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04.18.2019 21 new posts under Morning Note (9), International Summary (7), General (3), and 1 more category

International Summary

News Trading Desk

International Summary

"CAPIS FOMC Day Global Markets 1 30 2019"

posted by Matthew Kiselica on 01/30/2019 at 7:13 am

by Matthew Kiselica

01/30/2019 at 7:13 am

Asian Markets

Asia was mixed with the markets generally awaiting a slew of important items including today’s FOMC meeting and tomorrow’s Sino-U.S. trade talks.  S. Korea outpeformed.  The Finance Ministry is considering a reduction to a transaction tax charged on equity trades.  Sectors were mixed with minimal moves, overall.  Consumer staples, consumer discretionary, utilities and healthcare gave way by c. 0.5%. Real estate improved by more than 0.5% with miners ahead by about that mark.

Important Headlines

  • Apple suppliers were mixed following its results out after the U.S. close.  Overall, they are reassuring following recent worries.  Chip suppliers rallied but display sunk.  That was also due to LG Display -3.7% seeing pressure on panel/screens this year.
  • China Life -1.9% suffered multiple downgrades following yesterday’s outlook cut.  The company now sees FY ’18 NI down 50 to 70%!
  • After yesterday’s close, Daiwa Sec. -6.5% revealed a 47.0% decline in OP.
  • On the macro side of things, Japan’s December retail sales beat expectations as did Australia’s Q4 CPI.   S. Korean department store sales continued to fall in December but at a much slower rate than November.
  • After today’s close there were a slew of earnings out across the region.  Those include Advantest, Canon, ICICI, LG Chem and POSCO.

European Markets

Europe has been mixed most of the session but has shown improvement since the open especially as some of the U.S. earnings have come across the tape.  The EU markets have also seen a slew of earnings this morning.  Currently, most sectors have improved.  Personal goods and basic resources stand out with gains exceeeing 1.5%.  Lagging all morning have been telecoms off c. 0.5% followed by industrials and healthcare.

The commodity markets are generally stronger.  Iron ore continues to advance on Vale’s woes due to the terrible dam burst in Brazil.  Gold remains above $1,300 and will have its 4th consecutive monthly advance for the first time since 2016.

The Day’s Important Snippets

  • LVMH +6.9% is providing the boost to personal goods and specifically the luxury goods sector.  It is seeing better demand in China and for leather goods.  FY revenues reached a record €46.8b up 10.0% y/y.  Q4 Organic revenues are up 10.0% excluding a one-off.  Recurring operating revenue earnings improved 21.0% with margin also better to 21.4%.
  • Siemens -1.2% Q1 NP €1.12b vs. EUR 1.15be, down 49.0% y/y. Taxes are higher than anticipated and the company believes demand for power turbines is falling.
  •  EPS at Novartis -1.0% missed expectations: Q4 core EPS $1.25 vs. $1.26e. Q4.  Sales are $13.27b which is inline with expectations.  The company provides an improved outlook but pricing pressures are noted for the current FY.  The company still sees the Alcon spin-off occurring in H1 of this year.

On Our Side of the Pond

  • Apple is trading up pre-market following the results out after yesterday’s close.
  • There are plenty of other earnings out or due today including Boeing, McDonalds, Alibaba, AT&T, Microsoft, Tesla and Facebook.
  • Of course, the FOMC decision is the most important item of the day.

Markets and Macro

Markets Snapshot

Event Survey Actual Prior Revised
SK Business Survey Manufacturing Feb 65 71
SK Business Survey Non-Manufacturing Feb 70 72
AU ANZ Roy Morgan Weekly Consumer Confidence Index 27-Jan 116.5 115.7
JN Retail Trade YoY Dec 1.00% 1.30% 1.40%
JN Retail Sales MoM Dec P 0.40% 0.90% -1.00% -1.10%
JN Dept. Store, Supermarket Sales Dec -1.10% -1.00% -2.20%
UK BRC Shop Price Index YoY Jan 0.40% 0.30%
AU CPI QoQ 4Q 0.40% 0.50% 0.40%
AU CPI YoY 4Q 1.70% 1.80% 1.90%
AU CPI Trimmed Mean QoQ 4Q 0.40% 0.40% 0.40%
AU CPI Trimmed Mean YoY 4Q 1.80% 1.80% 1.80%
AU CPI Weighted Median QoQ 4Q 0.50% 0.40% 0.30% 0.40%
AU CPI Weighted Median YoY 4Q 1.70% 1.70% 1.70% 1.80%
SK Department Store Sales YoY Dec -0.70% -3.90%
SK Discount Store Sales YoY Dec -3.60% -2.80%
JN Consumer Confidence Index Jan 42.4 41.9 42.7
FR GDP QoQ 4Q A 0.20% 0.30% 0.30%
FR GDP YoY 4Q A 0.90% 0.90% 1.40% 1.30%
GE Import Price Index MoM Dec -0.80% -1.30% -1.00%
GE Import Price Index YoY Dec 2.10% 1.60% 3.10%
GE GfK Consumer Confidence Feb 10.3 10.8 10.4 10.5
FR PPI MoM Dec -1.10% 0.40% 0.30%
FR PPI YoY Dec 1.20% 2.60%
FR Consumer Spending MoM Dec -0.30% -1.50% -0.30% -0.10%
FR Consumer Spending YoY Dec -0.70% -2.30% -2.00% -1.50%
SP Total Mortgage Lending YoY Nov 12.80% 13.90%
SP House Mortgage Approvals YoY Nov 14.20% 20.40%
SP Retail Sales YoY Dec 0.00% 1.50%
SP Retail Sales SA YoY Dec 0.80% 1.40% 1.10%
HK Retail Sales Value YoY Dec 1.40% 0.10% 1.40%
HK Retail Sales Volume YoY Dec 2.50% 0.20% 1.20%
IT Consumer Confidence Index Jan 112.8 114 113.1 113.2
IT Manufacturing Confidence Jan 103 102.1 103.6 103.4
IT Economic Sentiment Jan 99.2 99.8 99.7
UK Net Consumer Credit Dec 0.8b 0.7b 0.9b 1.0b
UK Net Lending Sec. on Dwellings Dec 3.6b 4.1b 3.5b 3.6b
UK Mortgage Approvals Dec 63.1k 63.8k 63.7k 64.0k
UK Money Supply M4 MoM Dec 0.40% 0.00% 0.10%
UK M4 Money Supply YoY Dec 2.00% 0.80%
UK M4 Ex IOFCs 3M Annualised Dec 4.30% 1.70% 2.10%
EC Economic Confidence Jan 106.8 106.2 107.3 107.4
EC Business Climate Indicator Jan 0.77 0.69 0.82 0.86
EC Industrial Confidence Jan 0.5 0.5 1.1 2.3
EC Services Confidence Jan 11.5 11 12 12.2
EC Consumer Confidence Jan F -7.9 -7.9 -7.9
US MBA Mortgage Applications 25-Jan -3.00% -2.70%
GE CPI MoM Jan P -0.80% 0.10%
GE CPI YoY Jan P 1.60% 1.70%
GE CPI EU Harmonized MoM Jan P -1.00% 0.30%
GE CPI EU Harmonized YoY Jan P 1.80% 1.70%
GE Jan. state CPI data delayed to Feb. 21 due to base year change
US ADP Employment Change Jan 181k 271k
US Pending Home Sales MoM Dec 0.50% -0.70%
US Pending Home Sales NSA YoY Dec -7.00% -7.70%
US FOMC Rate Decision (Upper Bound) 30-Jan 2.50% 2.50%
US FOMC Rate Decision (Lower Bound) 30-Jan 2.25% 2.25%

About the Author

MatthewKiselicaFVP,Manager of International Trading

Matthew Kiselica joined CAPIS in 2010 and has over twenty-five years of industry experience. Prior to CAPIS, he was vice president of Cazenove’s global sales trading desk in New York. Matthew is a board member for the National Psoriasis Foundation. He earned his bachelor’s degrees in fina...

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