09.30.2022 11 new Morning Note posts under Morning Note (10) and CAPIS Insights (1)

International Summary

News Trading Desk

International Summary

"CAPIS Global Markets 3/12/2019"

posted by CAPIS on 03/12/2019 at 6:51 am


03/12/2019 at 6:51 am

Asian Markets

Following the strong U.S. gains, the region posted solid gains.  Word PM May has been able to hammer out a last minute Brexit deal gave the markets additional momentum.  More on this in the European section.  For the second consecutive session, Australia lagged.

Australia continues to see weaker economic data.  Various housing related statistics all declined during January.  NAB confidence results also show weakening sentiment.

All major sectors gained and many end the day better more than 1%.  Those include industrials, IT, telcos, real estate and healthcare.


Other Important Headlines

  • Morgan Stanley is bullish on both the Chinese and Emerging Markets by year end.  The broker sees the MSCI Emerging Markets Index higher by 8%.
  • Hon Hai +1.1% Chair Gou was adamant his firm has not violated agreements with Apple.  This follows word Apple has filed a patent infringement suit against subsidiary FIH Mobile +1.0%.
  • ISS is recommending two of Elliott’s nominees for Hyundai Motor’s +3.5% board.  However, the shareholder advisory agency is not in favor Elliott’s dividend proposal.
  • Bernstein estimates Macau gaming revenues are down 5% m/m as of March 10th.
  • Contemporary Amperex Tech +3.5% traded well following word it is negotiating with Tesla to supply batteries for its model 3 cars assembled near Shanghai.
  • After the close, Ping An reported NI that is better than Bloomberg consensus.

European Markets

The aforementioned Brexit deal has been the markets’ primary focus.  PM May flew to Germany late yesterday and hammered out the latest version of this crucial issue with the EU’s Juncker.  The Irish “backstop” is one of the key matters that has been addressed.  Shortly after 7AM Eastern, U.K. Attorney General Cox issued an unfavourable (not a typo) ruling on the agreement.  Members of Parliament are now scrambling to review ahead of a vote scheduled for this evening.  Stay tuned!

After initial gap to highs, the region had pared the advance.  However, the market moved into the red on the opinion of Mr. Cox.  The U.K. lagged all session due to currency effects but outperforms.  Initially, the currency markets were seeing a  stronger £.  However, those gains have been erased and Stirling is now lower.

Prior to the headlines, most sectors were to the upside.  However, that has changed dramatically.  Most are now lower with losses of c. 0.5% among telecoms, energy, basic resources and banks.  Financials, utilities and retail are up small.

Snippets from the Region

  • After the Japanese markets had closed, Renault +0.1%, Nissan +1.0% and Mitsubishi +1.0% held their press conference regarding the strategic alliance.  A new operating board is being established that will meet monthly and be chaired by Renault Chairman Senard.  The key responsibilities will be to streamline operational cooperation and prevent the transgressions alleged against former Chair Ghosn.  Mr. Senard says the agreement does not address cross-shareholdings.
  • VW’s -1.2% results show a number of issues: margin slippage, negative Chinese comments and the company says will need to see a stronger H2 to meet forecasts.  It also is facing another EU diesel probe.

On Our Side of the Pond

  • Boeing continues to see further bans on flights with the 737 Max aircraft.  Singapore and Australia are among the nation’s taking action.  Lion Air is considering switching order to Airbus +0.15%.  The FAA foresees mandating changes for the aircraft next month but says it is airworthy.
  • The results and outlook at ADT miss expectations.
  • General Mills subsidiary Pillsbury has ordered a flour recall due to possible salmonella contamination.
  • Apple sets new product reveal for April 25th.
  • The U.S. has ordered all remaining diplomats to leave Venezuela.

Markets and Macro

Markets Snapshot

Event Survey Actual Prior Revised
AU ANZ Roy Morgan Weekly Consumer Confidence Index 10-Mar 109.5 114.8
JN BSI Large All Industry QoQ 1Q -1.7 4.3
JN BSI Large Manufacturing QoQ 1Q -7.3 5.5
AU Manpower Survey 2Q 10% 14%
IN Manpower Survey 2Q 13% 12%
JN Manpower Survey 2Q 27 27
AU NAB Business Conditions Feb 4 7
AU NAB Business Confidence Feb 2 4
AU Home Loans MoM Jan -2.00% -1.20% -8.20% -8.00%
AU Investment Lending Jan -1.50% -4.10% -4.60% -4.40%
AU Owner-Occupier Loan Value MoM Jan 0.00% -1.30% -6.40% -5.30%
HK Manpower Survey 2Q 19% 18%
CH Manpower Survey 2Q 6% 10%
FR Total Payrolls 4Q 0.10% 0.20% 0.10%
FR Private Sector Payrolls QoQ 4Q F 0.10% 0.30% 0.10%
UK Visible Trade Balance GBP/Mn Jan -£12200m -£13084m -£12102m -£12686m
UK Trade Balance Non EU GBP/Mn Jan -£3800m -£4977m -£3642m -£4369m
UK Trade Balance Jan -£3500m -£3825m -£3229m -£3448m
UK Industrial Production MoM Jan 0.20% 0.60% -0.50%
UK Industrial Production YoY Jan -1.30% -0.90% -0.90%
UK Manufacturing Production MoM Jan 0.20% 0.80% -0.70%
UK Manufacturing Production YoY Jan -1.90% -1.10% -2.10%
UK Construction Output SA MoM Jan 0.80% 2.80% -2.80%
UK Construction Output SA YoY Jan -0.20% 1.80% -2.40%
UK GDP (MoM) Jan 0.20% 0.50% -0.40%
UK Monthly GDP 3M/3M Change Jan 0.20% 0.20% 0.20%
UK Index of Services MoM Jan 0.20% 0.30% -0.20%
UK Index of Services 3M/3M Jan 0.50% 0.50% 0.40%
US NFIB Small Business Optimism Feb 102.5 101.7 101.2
IN CPI YoY Feb 2.40% 2.05%
IN Industrial Production YoY Jan 2.10% 2.40%
US CPI MoM Feb 0.20% 0.00%
US CPI Ex Food and Energy MoM Feb 0.20% 0.20%
US CPI YoY Feb 1.60% 1.60%
US CPI Ex Food and Energy YoY Feb 2.20% 2.20%
US CPI Core Index SA Feb 261.193 260.701
US CPI Index NSA Feb 252.837 251.712
US Real Avg Weekly Earnings YoY Feb 1.90%
US Real Avg Hourly Earning YoY Feb 1.70% 1.60%

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