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08.21.2019 18 new Morning Note posts under Morning Note (10) and International Summary (8)

International Summary

News Trading Desk

International Summary

"CAPIS Global Markets 8/13/2019"

posted by Matthew Kiselica on 08/13/2019 at 6:55 am

by Matthew Kiselica

08/13/2019 at 6:55 am

Markets Over View

Following the reaction to yesterday’s news out of Hong Kong and corresponding sell-off, it is no surprise the Asian markets.  Hong Kong saw the heaviest selling pressure.  Japan returned from its three day weekend to trade lower with a stronger ¥ vs. Friday’s close weighing.  The TOPIX losses erase the gains that had been made YTD.  Singapore managed to trade to the upside following its own three day holiday.

Most of the Asian sectors end the day to the downside.  In fact, energy was the only one to manage an uptick.  Losses of 1% or greater occurred among telcos, consumer discretionary, real estate and financials to name a few.

The European markets are continuing to see selling pressure.  Equities set new lows following ZEW readings for both Germany and the EU that are well below expectations.   Also, once again outbound flights from Hong Kong International airport have been canceled.

The debt markets are seeing yields continuing to move lower.  However, Italian yields are not taking part.  A story that has been lost among some of the other global headlines is the political unrest in Italy.  Post the local close, the Italian parliament will meet to determine when a confidence vote will be held for the current coalition.  Commodities see gold higher c. 1% paring even stronger gains earlier in the day.

Corporate Headlines

  • Henkel -7.1%: Q2 EBIT is below expectations.  The company now forecasts flat sales growth and a decline in EPS of c. 10.0%.    It cites slowing sales in China for some personal goods along with slowing demand from the auto sector.
  • Bridgestone -3.2% deflated following results from Friday.  The company cut its FY OP from ¥410b to ¥375b which is below the Bloomberg range.
  • Swiss Life -1.3%: Both H1 OP and NI are ahead of consensus.  The shares were up small to flat but then dipped as Europe made new lows.
  • Challenger +2.5% post results.  The initial reaction was even stronger before paring the advance.  Some of the initial surge was attributed to short selling.  Company hit its prior revised target of norm. PBT of A$548.3m.  It is seeing inflows in certain categories bucking market trend.  Affirms FY20 outlook: norm. PBT A$500 to A$550m with a stable dividend.

On Our Side of the Pond

  • Keep your eyes peeled for CBS/Viacom news as merger negotiations continue.
  • Tencent Music Group is falling sharply in pre-market trading.  Revenues of CNY 5.9b are a slight miss vs. CNY5.95b expected.  Slowing ARPPU is worrisome which is slowing growth from 28.0% in the previous quarter to 16.5%.
  • JD.com’s Q2 results and Q3 outlook are boosting the shares pre-market.
  • Keep your eyes peeled for more fallout down in Argentina and the U.S. CPI is due.

Markets & Macro

Markets

Event Survey Actual Prior Revised
AU ANZ Roy Morgan Weekly Consumer Confidence Index 11-Aug 115.5 115.8
JN PPI MoM Jul 0.10% 0.00% -0.50%
JN PPI YoY Jul -0.50% -0.60% -0.10%
AU NAB Business Conditions Jul 2 3 4
AU NAB Business Confidence Jul 4 2
CH Foreign Direct Investment YoY CNY Jul 8.70% 8.50%
SK Money Supply L SA MoM Jun 0.40% 0.30%
SK Money Supply M2 SA MoM Jun 0.70% 0.40%
SK Bank Lending To Household Total Jul KR854.7t KR848.9t KR849.0t
JN Tertiary Industry Index MoM Jun -0.10% -0.10% -0.20% 0.00%
GE Wholesale Price Index YoY Jul 0.10% 0.30%
GE Wholesale Price Index MoM Jul -0.30% -0.50%
GE CPI MoM Jul F 0.50% 0.50% 0.50%
GE CPI YoY Jul F 1.70% 1.70% 1.70%
GE CPI EU Harmonized MoM Jul F 0.40% 0.40% 0.40%
GE CPI EU Harmonized YoY Jul F 1.10% 1.10% 1.10%
JN Machine Tool Orders YoY Jul P -33.00% -37.90%
EC SURVEY REPORT: Euro Area Economic Forecasts in Aug. 2019
SP CPI Core MoM Jul -0.80% 0.20%
SP CPI Core YoY Jul 0.90% 0.90%
SP CPI MoM Jul F -0.60% -0.60% -0.60%
SP CPI YoY Jul F 0.50% 0.50% 0.50%
SP CPI EU Harmonised MoM Jul F -1.10% -1.10% -1.10%
SP CPI EU Harmonised YoY Jul F 0.70% 0.60% 0.70%
UK SURVEY REPORT: U.K. Economic Forecasts in August 2019
UK Claimant Count Rate Jul 3.20% 3.20%
UK Jobless Claims Change Jul 28.0k 38.0k 31.4k
UK Average Weekly Earnings 3M/YoY Jun 3.70% 3.70% 3.40% 3.50%
UK Weekly Earnings ex Bonus 3M/YoY Jun 3.80% 3.90% 3.60%
UK ILO Unemployment Rate 3Mths Jun 3.80% 3.90% 3.80%
UK Employment Change 3M/3M Jun 60k 115k 28k
GE ZEW Survey Current Situation Aug -6.3 -13.5 -1.1
GE ZEW Survey Expectations Aug -28 -44.1 -24.5
EC ZEW Survey Expectations Aug -43.6 -20.3
US NFIB Small Business Optimism Jul 104 104.7 103.3
IN CPI YoY Jul 3.09% 3.18%
US CPI MoM Jul 0.30% 0.10%
US CPI Ex Food and Energy MoM Jul 0.20% 0.30%
US CPI YoY Jul 1.70% 1.60%
US CPI Ex Food and Energy YoY Jul 2.10% 2.10%
US CPI Core Index SA Jul 263.302 262.803
US CPI Index NSA Jul 256.441 256.143
US Real Avg Hourly Earning YoY Jul 1.50%
US Real Avg Weekly Earnings YoY Jul 1.20%

About the Author

Matthew Kiselica headshot
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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