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05.23.2019 15 new Morning Note posts under Morning Note (10) and International Summary (5)

International Summary

News Trading Desk

International Summary

"Valentine’s Day Global Markets 2/14/2019"

posted by Matthew Kiselica on 02/14/2019 at 7:00 am

by Matthew Kiselica

02/14/2019 at 7:00 am

Asian Markets

The region’s markets were mixed with most indices posting modest moves in either direction.  Investors showed little response to the earlier report the U.S. trade tariff  deadline may be extended by 60 days.  The exception is the KOSPI which advanced more than 1%.  The bulk of the day’s advance was buying on the close due to expiry.

In keeping with the markets, sectors were mixed.  Consumer staples and healthcare gained less than 0.5% while telcos gave ground by about that market.

China’s January trade balance was stronger than expected.  In USD terms, exports rose 9.1% y/y vs. a decline of 3.3% expected.  Imports dipped 1.5% but that is well ahead of the 10.2% slide anticipated.  This results in a trade surplus of $39.2b. Japan’s Q4 GDP rose 1.4% which is inline.

 

Other Important Headlines

  • Telstra -2.2% cut its dividend and is seeing margin erosion as rollout of NBN data sharing increases costs and competition.
  • Newcrest Mining’s -1.4% H1 earnings are better by 104%.  However, the cost per ounce is higher by 11% during the period.
  • MGM China’s +0.9% Q4 adj. property Ebitda rose 11% to $167m, topping estimates.
  • Sunny Optical -5.0% issued a profit warning for FY ’18. Both Credit Suisse and Jefferies cut ratings blaming margin concerns.
  • Woodside Petrol’s +1.9% 2018 profits are better by 28% and the company will raise its final dividend by 86% to 91 cents.
  • While underlying profits at AMP -7.8% are ahead of expectations for last year.  However, the company is suffering heavy outflows due to misconduct investigations.

European Markets

The region has spent the entire session to the upside on a heavy earnings day.  Italy has lagged the rest of the markets as its 10 yr. yield vs. the corresponding German bund is widening.  Sectors are split.  Food/beverages, industrials, technology and chemicals are better by at least 1%.  Limiting gains are financials lower c.0.5% followed by banks, retail and basic resources.

Macro from the region shows Germany’s Q4 preliminary GDP a touch light and flat which puts it close to falling into recession.  The EC’s result was bang inline.

Keep you eyes open for Brexit headlines at Parliament debates the matter today.  (This sounds very familiar for some reason.)

Snippets from the Region

  • Following a cut to Emirates A380 Superjumbo orders, Airbus +4.0% has decided to cut the program!
  • Nestle’s +3.0% FY organic sales of 3% match estimates.  The company sees organic sales improving this year AND is making positive Chinese growth comments.  It is exploring options for its Herta unit including a potential sale.
  • Credit Suisse -1.7% saw inflows at its asset management arm and the investment bank improved overall.   However, trading losses are worse than expected and CEO Thiam notes caution for FY ’19.
  • AstraZeneca’s +5.4% results are just want the doctor ordered.  Q4 EPS are better than expected and the company sees sales and EPS improving this year.

Plenty more out there today!

On Our Side of the Pond

  • The House of Representatives will vote on the tentative spending/border bill this evening.
  • Keep an eye on Boeing following the Airbus news.
  • Earnings out or still due include Cisco, AIG, Bombardier, Banco de Brasil, Brookfield and Coca-Cola.

Markets and Macro

Markets Snapshot

Event Survey Actual Prior Revised
JN GDP SA QoQ 4Q P 0.40% 0.30% -0.60% -0.70%
JN GDP Annualized SA QoQ 4Q P 1.40% 1.40% -2.50% -2.60%
JN GDP Nominal SA QoQ 4Q P 0.40% 0.30% -0.70% -0.60%
JN GDP Deflator YoY 4Q P -0.40% -0.30% -0.30% -0.40%
JN GDP Private Consumption QoQ 4Q P 0.70% 0.60% -0.20%
JN GDP Business Spending QoQ 4Q P 1.80% 2.40% -2.80% -2.70%
AU Consumer Inflation Expectation Feb 3.70% 3.50%
UK RICS House Price Balance Jan -20% -22% -19%
SK Money Supply L SA MoM Dec 0.50% 0.20%
SK Money Supply M2 SA MoM Dec 0.30% 0.50%
CH Trade Balance CNY Jan 245.00b 271.16b 394.99b
CH Exports YoY CNY Jan 3.80% 13.90% 0.20%
CH Imports YoY CNY Jan -1.90% 2.90% -3.10%
CH Trade Balance Jan $34.30b $39.16b $57.06b
CH Exports YoY Jan -3.30% 9.10% -4.40%
CH Imports YoY Jan -10.20% -1.50% -7.60%
SK Bloomberg Feb. South Korea Economic Survey (Table)
FR ILO Unemployment Rate 4Q 9.10% 8.80% 9.10%
FR Mainland Unemp. Change 000s 4Q -90k 22k 18k
FR ILO Mainland Unemployment Rate 4Q 8.80% 8.50% 8.80%
IN Wholesale Prices YoY Jan 3.70% 2.76% 3.80%
GE Wholesale Price Index YoY Jan 1.10% 2.50%
GE Wholesale Price Index MoM Jan -0.70% -1.20%
GE GDP SA QoQ 4Q P 0.10% 0.00% -0.20%
GE GDP NSA YoY 4Q P 0.80% 0.90% 1.10%
GE GDP WDA YoY 4Q P 0.70% 0.60% 1.10%
CH Foreign Direct Investment YoY CNY Jan 4.80% 24.90%
EC Employment QoQ 4Q P 0.30% 0.20% 0.20%
EC Employment YoY 4Q P 1.20% 1.30% 1.30%
EC GDP SA QoQ 4Q P 0.20% 0.20% 0.20%
EC GDP SA YoY 4Q P 1.20% 1.20% 1.20%
CA Manufacturing Sales MoM Dec 0.40% -1.40%
US PPI Final Demand MoM Jan 0.10% -0.20% -0.10%
CA New Housing Price Index MoM Dec 0.00% 0.00%
US PPI Ex Food and Energy MoM Jan 0.20% -0.10% 0.00%
CA New Housing Price Index YoY Dec 0.00% 0.00%
US PPI Ex Food, Energy, Trade MoM Jan 0.20% 0.00%
US PPI Final Demand YoY Jan 2.10% 2.50%
US PPI Ex Food and Energy YoY Jan 2.50% 2.70%
US PPI Ex Food, Energy, Trade YoY Jan 2.70% 2.80%
US Initial Jobless Claims 9-Feb 225k 234k
US Continuing Claims 2-Feb 1740k 1736k
US Retail Sales Advance MoM Dec 0.10% 0.20%
US Retail Sales Ex Auto MoM Dec 0.00% 0.20%
US Retail Sales Ex Auto and Gas Dec 0.40% 0.50%
US Retail Sales Control Group Dec 0.40% 0.90%
US Bloomberg Consumer Comfort 10-Feb 58.2
US Business Inventories Nov 0.20% 0.60%

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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