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03.21.2019 26 new posts under International Summary (16), Morning Note (9), Compliance Docs. (1)

International Summary

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International Summary

"CAPIS Global Markets 2/28/2019"

posted by Matthew Kiselica on 02/28/2019 at 7:37 am

by Matthew Kiselica

02/28/2019 at 7:37 am

Asian Markets

The region traded lower with growth concerns and an abrupt end to the U.S.-N. Korean Summit.  The early conclusion to the meeting was a huge negative for the KOPSI.  It also didn’t help it was a net sell in today’s global MSCI rebalance.  Most sectors traded lower with IT off more than 1% followed by telcos and real estate.  Healthcare was the only group to gain.

Global macro fears were sparked by a number of important data points.  China’s February Manufacturing PMI is below consensus and is the 3rd consecutive month in which the gauge is below the key 50 level.   Some of the slowdown is due to the Lunar New Year during the month.  Japanese data also showed slowing trends.  The preliminary January industrial production results fell more than ancticipated and is the largest decline since January of last year. Retail sales also slumped more than thought.  In S. Korea, the BoK left rates unchanged, as expected.

Other Important Headlines

  • Sun Hung Kai Prop -2.2% and Rio Tinto +1.1% following yesterday’s results.
  • In the Macau gaming sector, Galaxy Ent. -0.2% reported results.  While FY Revenues are well short of expectations, EBITDA was inline while NI beat.
  • After the close, Bharti Airtel announced a capital increase of $4.5b via a rights and bond issue.

European Markets

As a whole, Europe has been lower since the open.  However, the markets are mixed.  Italy and Spain outperform and the UK lags.  The macro worries have basic resources lower more than 2%.  They are being followed by industrials, utilities and personal goods.  Media has led all session and is currently better by more than 0.5% followed retail, banks and food/bevies.

The commodity markets are generally lower due to the slowdown worries.  However, gold is trading to the upside.  This could be in part due to the tensions in Kashmir.  On that front and a positive headline, Pakistan stated it will free the captured Indian polit tomorrow.

Important Snippets

  • AB Inbev +5.0% is having a solid day.   Earnings in Q4 are better by 10.0%.  That is solid growth and also alleviates recent worries sparked by last week’s Kraft Heinz profit warning.
  • British American Tobacco’s -1.6% results are inline.  However, the company lowered its FY19 revenue target for “next generation products.”  FD Stevens is stepping down and is being succeeded by Tadeu Marroco.
  • Human resource giant Adecco -5.0% is struggling.  The company is taking a goodwill impairment charge in Q4 citing weakness in Germany.  This results in a Q4 loss for the company.  Furthermore, January organic growth fell 2% y/y.
  • Other earnings on the day include Engie -3.4%, ABB -3.0% and Zalando +22.7%.
  • The media strength is being provided by Vivendi +4.2%.  Reuters indicates both KKR and Tencent are interested in securing stakes in Universal Music Group.  Additional, results at Mediaset Espana +0.8% helping the sector.

On Our Side of the Pond

  • Results include HP, TD Bank and JD.Com.
  • Wabco confirms it is conducting talks with ZF Friedrishshafen.  This may lead to a bid from the German company.
  • We await the U.S. jobless data and GDP.

On the Markets Agenda for Tonight

  • Macro includes Australian home prices, S. Korean trade, Japanese CPI and a host of manufacturing PMI readings.
  • Results include Linde, WPP, LSE and William Hill.

REMINDER:  Global MSCI Rebalance on the close, MIND YOUR EYE!

Markets and Macro

Event Survey Actual Prior Revised
SK Industrial Production YoY Jan 1.20% 0.10% 1.60% 0.70%
SK Industrial Production SA MoM Jan 0.30% 0.50% -1.40% -0.80%
SK Cyclical Leading Index Change Jan -0.4 -0.2
JN Industrial Production MoM Jan P -2.50% -3.70% -0.10%
JN Industrial Production YoY Jan P 1.30% 0.00% -1.90%
JN Retail Trade YoY Jan 1.40% 0.60% 1.30%
JN Retail Sales MoM Jan P -0.80% -2.30% 0.90%
JN Dept. Store, Supermarket Sales Jan -1.80% -3.30% -1.00%
JN Japan Buying Foreign Bonds 22-Feb ¥1014.9b ¥193.7b ¥196.2b
JN Japan Buying Foreign Stocks 22-Feb -¥200.4b -¥59.1b
JN Foreign Buying Japan Bonds 22-Feb ¥317.2b ¥84.3b
JN Foreign Buying Japan Stocks 22-Feb -¥15.2b -¥52.9b -¥53.3b
AU Bloomberg Feb. Australia Economic Survey (Table)
UK GfK Consumer Confidence Feb -15 -13 -14
UK Lloyds Business Barometer Feb 4 19
AU Private Capital Expenditure 4Q 1.00% 2.00% -0.50% 0.00%
AU Private Sector Credit MoM Jan 0.30% 0.20% 0.20%
AU Private Sector Credit YoY Jan 4.30% 4.30% 4.30% 4.40%
SK BoK 7-Day Repo Rate 28-Feb 1.75% 1.75% 1.75%
CH Swift Global Payments CNY Jan 2.15% 2.07%
CH Composite PMI Feb 52.4 53.2
CH Non-manufacturing PMI Feb 54.5 54.3 54.7
CH Manufacturing PMI Feb 49.5 49.2 49.5
JN Vehicle Production YoY Dec -0.70% 4.60%
JN Housing Starts YoY Jan 10.30% 1.10% 2.10%
JN Annualized Housing Starts Jan 0.954m 0.872m 0.961m
JN Construction Orders YoY Jan 19.80%
GE Import Price Index MoM Jan 0.20% -0.20% -1.30%
GE Import Price Index YoY Jan 1.20% 0.80% 1.60%
UK Nationwide House PX MoM Feb 0.00% -0.10% 0.30% 0.20%
UK Nationwide House Px NSA YoY Feb 0.30% 0.40% 0.10%
FR PPI MoM Jan 0.10% -1.10%
FR PPI YoY Jan 1.40% 1.20% 1.30%
FR Consumer Spending MoM Jan 1.10% 1.20% -1.50%
FR Consumer Spending YoY Jan 0.80% 1.00% -2.30%
FR CPI EU Harmonized MoM Feb P 0.30% 0.10% -0.60%
FR CPI EU Harmonized YoY Feb P 1.70% 1.50% 1.40%
FR CPI MoM Feb P 0.40% 0.00% -0.40%
FR CPI YoY Feb P 1.50% 1.30% 1.20%
FR GDP QoQ 4Q P 0.30% 0.30% 0.30%
FR GDP YoY 4Q P 0.90% 0.90% 0.90%
GE CPI Saxony MoM Feb 0.30% -1.00%
GE CPI Saxony YoY Feb 1.40% 1.40%
SP CPI MoM Feb P 0.30% 0.20% -1.30%
SP CPI YoY Feb P 1.10% 1.10% 1.00%
SP CPI EU Harmonised MoM Feb P 0.10% 0.20% -1.70%
SP CPI EU Harmonised YoY Feb P 1.00% 1.10% 1.00%
HK Budget Balance HKD Jan 49.1b 86.8b
HK Money Supply M1 HKD YoY Jan -5.20% -2.60%
HK Money Supply M2 HKD YoY Jan 1.40% 3.60%
HK Money Supply M3 HKD YoY Jan 1.50% 3.70%
GE CPI Brandenburg MoM Feb 0.60% -0.50%
GE CPI Brandenburg YoY Feb 1.60% 1.30%
GE CPI Hesse MoM Feb 0.50% -1.00%
GE CPI Hesse YoY Feb 1.10% 0.90%
GE CPI Bavaria MoM Feb 0.50% -1.00%
GE CPI Bavaria YoY Feb 1.70% 1.70%
GE CPI Baden Wuerttemberg MoM Feb 0.50% -0.90%
GE CPI Baden Wuerttemberg YoY Feb 1.70% 1.60%
SP Current Account Balance Dec 4.7b 1.8b
GE CPI North Rhine Westphalia MoM Feb 0.50% -0.70%
GE CPI North Rhine Westphalia YoY Feb 1.60% 1.50%
IT CPI EU Harmonized MoM Feb P -0.20% -0.20% -1.70%
IT CPI NIC incl. tobacco MoM Feb P 0.20% 0.20% 0.10%
IT CPI NIC incl. tobacco YoY Feb P 1.10% 1.10% 0.90%
IT CPI EU Harmonized YoY Feb P 1.20% 1.20% 0.90%
CA CFIB Business Barometer Feb 59 56.1
IN Eight Infrastructure Industries Jan 1.80% 2.60% 2.70%
IN GDP YoY 4Q 6.70% 6.60% 7.10%
IN GDP Annual Estimate YoY 2019 7.20% 7.00% 6.70%
IN GVA YoY 4Q 6.50% 6.30% 6.90%
GE CPI MoM Feb P 0.40% 0.50% -0.80%
GE CPI YoY Feb P 1.50% 1.60% 1.40%
GE CPI EU Harmonized MoM Feb P 0.60% 0.50% -1.00%
GE CPI EU Harmonized YoY Feb P 1.70% 1.70% 1.70%
CA Current Account Balance 4Q -$13.25b -$15.48b -$10.34b -$10.11b
US BEA Releasing Initial 4Q GDP (Combining Initial/Second)
US Initial Jobless Claims 23-Feb 220k 225k 216k 217k
US Continuing Claims 16-Feb 1737k 1805k 1725k 1726k
CA Industrial Product Price MoM Jan 0.10% -0.30% -0.70% -0.80%
CA Raw Materials Price Index MoM Jan 3.80% 3.80%
US GDP Annualized QoQ 4Q A 2.20% 2.60% 3.40%
US Personal Consumption 4Q A 3.00% 2.80% 3.50%
US GDP Price Index 4Q A 1.70% 1.80% 1.80%
US Core PCE QoQ 4Q A 1.60% 1.70% 1.60%
US Chicago Purchasing Manager Feb 57.5 56.7
US Bloomberg Consumer Comfort 24-Feb 59.6
US Kansas City Fed Manf. Activity Feb 6 5

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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