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International Summary

News Trading Desk

International Summary

"CAPIS Global Markets 3/11/2018"

posted by Matthew Kiselica on 03/11/2019 at 7:04 am

by Matthew Kiselica

03/11/2019 at 7:04 am

Asian Markets

Most of region advanced seeing a bounce from Friday’s sharp declines.  The Chinese markets led the way due to several factors: Trade chatter, supportive comments from PBoC Gov. Yi and benign inflation data.  India set national elections to be conducted in various phases between April 11th and May 19th.  The final results will be disclosed on May 23rd.

PBoC Gov. Yi says the U.S. and China have reached “consensus” on “crucial” topics.  He specifically mentioned the yuan and G-20 commitments on currency matters.  He also indicates the central bank has room for additional reserve ratio reductions but the scope for the size is smaller than “previous years.”  He promises credit growth and support for “small firms.”

This resulted in all the major sectors finishing to the upside.  Industrials, IT, consumer discretionary, telcos, materials, consumer staples and utilities each advanced by at least 1%.  The comments by PBoC Gov. Yi boosted Chinese mid and small caps which is why Shenzhen led the region.

Other Important Headlines

  • Nissan +1.1%, Mitsubishi +0.7% and Renault +2.5% are conducting talks regarding their strategic alliance.  A press conference is schedule after the Tokyo Exchange close tomorrow.
  • The Kyodo alleges Hitachi Ltd +5.6% is considering the sale of its Hitachi Chemical +20.0% stake.  Hitachi Ltd. “declined” to comment specifically about the report while adding it weighs all options to increase value.
  • Both Tencent +2.25% and Netease are among those receiving gaming approvals from Chinese authorities.  A total of 95 games made the grade.
  • Omron trading limit up 15.0% following the addition to the Nikkei 225 we flagged on Friday. Pioneer (flat) will be removed.
  • Late on Friday, the Hong Kong Monetary Authority purchased HK$1.51b after the currency slipped below the weak end of its trading band.

European Markets

Europe has been trading higher since the open.  The markets pared their advance but bounced off the lows.   Most sectors are green.  Banks gain more c. 1% with basic resources and autos better by more than 0.5%.  Defensives have lost some steam and lag the market.

Regarding Brexit, PM May faces yet another test with a vote in Parliament due tomorrow.  Current projections indicate she will suffer another defeat as the deadline looms.

The commodities markets see crude trading higher.  Saudi Arabia reportedly will supply less oil than requested in April.  The IEA indicates the U.S. will continue to produce significant shale output and weaken OPEC’s influence for Texas Tea.

Corporate Snippets

  • Follow upon Friday’s speculation, Deutsche Bk +3.0% CEO Sewing reportedly is ceasing resistance to a merger with Commerzbank +5.2%.
  • Concerns weigh upon Safran -2.2% due to its engine jv with Boeing following a second crash of a 737 Max airplane.  More on this below.

On Our Side of the Pond

  • Circling back to the tragic Boeing plane crash in Eithiopia, China has order all 737 Max planes to be grounded.  The companies share are trading down sharply pre-market and weigh upon the DOW futures.
  • Nvidia % is purchasing Mellanox Tech for $6.9b.  The $125/sh cash bid represent a 14.0% premium to Friday’s close.
  • Levi Strauss has set is IPO price range at $14 to $16.
  • 60 Minutes aired an interview with Fed Chair Powell.  He reiterates the central bank patience regarding rate hikes.

Markets and Macro

Markets Shapsot

Event Survey Actual Prior Revised
CH CPI YoY Feb 1.50% 1.50% 1.70%
CH PPI YoY Feb 0.20% 0.10% 0.10%
CH Aggregate Financing CNY Feb 1300.0b 703.0b 4640.0b 4635.3b
CH Money Supply M2 YoY Feb 8.40% 8.00% 8.40%
CH Money Supply M1 YoY Feb 2.00% 2.00% 0.40%
CH Money Supply M0 YoY Feb 10.00% -2.40% 17.20%
CH New Yuan Loans CNY Feb 950.0b 885.8b 3230.0b
JN Money Stock M2 YoY Feb 2.40% 2.40% 2.40% 2.30%
JN Money Stock M3 YoY Feb 2.10% 2.10% 2.10%
JN Machine Tool Orders YoY Feb P -29.30% -18.80%
GE Industrial Production SA MoM Jan 0.50% -0.80% -0.40% 0.80%
GE Industrial Production WDA YoY Jan -3.30% -3.30% -3.90% -2.70%
GE Trade Balance Jan 15.2b 14.5b 13.9b 14.3b
GE Current Account Balance Jan 18.0b 18.3b 21.0b 23.1b
GE Exports SA MoM Jan -0.50% 0.00% 1.50%
GE Imports SA MoM Jan -0.10% 1.50% 1.20% 0.70%
GE Labor Costs SA QoQ 4Q -0.10% 1.00%
GE Labor Costs WDA YoY 4Q 2.00% 2.70% 2.60%
FR Bank of France Ind. Sentiment Feb 100 101 99
SP Retail Sales YoY Jan 1.70% 0.00% 0.10%
SP Retail Sales SA YoY Jan 1.00% 0.80% 0.80% 0.60%
US Retail Sales Advance MoM Jan 0.00% -1.20%
US Retail Sales Ex Auto MoM Jan 0.30% -1.80%
US Retail Sales Ex Auto and Gas Jan 0.60% -1.40%
US Retail Sales Control Group Jan 0.60% -1.70%
CA Bloomberg Nanos Confidence 8-Mar 55
US Business Inventories Dec 0.60% -0.10%

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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