The Greater Chinese markets traded lower following Friday’s report a Chinese agricultural delegation cancelled scheduled meetings in the States. China’s Agricultural Minister downplayed the matter but investors still took it as an overall negative. Additionally, the deputy level Sino-U.S. trade talks had no real information for traders to sink their teeth into. Rate cut hopes gave Australia a small bid and India continues to move ahead following last week’s corporate tax news. Japan was closed for the Autumnal Equinox.
All the major sectors in Asia end the day lower to one extent or the other. Real estate and healthcare end the day off c. 0.8%. Financials and consumer staples led with modest declines.
The European markets have been lower since the open. Both German and Eurozone Markit manufacturing readings show additional erosion, falling further below the key 50 level. Furthermore, both reading are below consensus. The German result is a 10 yr. low and the Eurozone reading a 7 year low. The Egyptian market saw heavy selling pressure yesterday due to local unrest. It is lower again today but has pared losses. The country is seeing a wave of protests against Pres. Sisi’s government. Elsewhere on the political front, Israeli Pres. Rivlin will meet with various parties this week in his process to decide which candidate has the best chance to form a coalition.
Following the German macro data, the auto sector has been off 2% or more all session. Chemicals, industrials, construction, technology and energy trade off by at least 1%. Food/beverages are improving by c. 0.5% while healthcare and travel/leisure make small advances.
- Thomas Cook (suspended) is filing for insolvency after negotiations with various parties including Fosun Tourism Grp -4.7% failed. The company’s debt is plunging. The collapse of the 178 year old U.K. firm has caused thousands of travelers to be stranded across the globe. The U.K. government is taking steps to assist them. Rival TUI 6.7% advances on the news along with some other players in the sector.
- Deutsche Bk -3.0% will transfer its prime brokerage unit to BNP -3.0% over the next several years. This includes roughly $80b in assets and c. 1,000 employees.
- Vonovia -0.15% and a Blackstone Group unit will acquire a 61.2% stake in Sweden’s Hembla +11.5%. The price of SEK 215 per Hembla share equates to an 11.5% premium to Friday’s close.
On Our Side of the Pond
- Fairly quiet start to the week.
- Various investors include Softbank founder Son is pushing to oust WeWork CEO Neumann.
- The Chicago Fed and U.S. Markit PMI readings are due.
Markets and Macro
|JN||Nationwide Dept Sales YoY||Aug||—||2.30%||-2.90%||—|
|JN||Tokyo Dept Store Sales YoY||Aug||—||4.70%||-2.70%||—|
|FR||Wages QoQ||2Q F||0.50%||0.50%||0.50%||—|
|JN||Convenience Store Sales YoY||Aug||—||0.80%||-2.50%||—|
|HK||CPI Composite YoY||Aug||3.10%||3.50%||3.30%||—|
|CA||Retail Sales MoM||Jul||0.60%||0.40%||0.00%||-0.10%|
|CA||Retail Sales Ex Auto MoM||Jul||0.30%||-0.10%||0.90%||—|
|EC||Consumer Confidence||Sep A||-7||-6.5||-7.1||—|
|US||Household Change in Net Worth||2Q||—||$1830b||$4691b||$5311b|
|AU||CBA Australia PMI Mfg||Sep P||—||49.4||50.9||—|
|AU||CBA Australia PMI Services||Sep P||—||52.5||49.1||—|
|AU||CBA Australia PMI Composite||Sep P||—||51.9||49.3||—|
|SK||Exports 20 Days YoY||Sep||—||-21.80%||-13.30%||—|
|SK||Imports 20 Days YoY||Sep||—||-11.10%||-2.40%||—|
|FR||Markit France Manufacturing PMI||Sep P||51.2||50.3||51.1||—|
|FR||Markit France Services PMI||Sep P||53.2||51.6||53.4||—|
|FR||Markit France Composite PMI||Sep P||52.6||51.3||52.9||—|
|GE||Markit/BME Germany Manufacturing PMI||Sep P||44||41.4||43.5||—|
|GE||Markit Germany Services PMI||Sep P||54.3||52.5||54.8||—|
|GE||Markit/BME Germany Composite PMI||Sep P||51.5||49.1||51.7||—|
|EC||Markit Eurozone Manufacturing PMI||Sep P||47.3||45.6||47||—|
|EC||Markit Eurozone Services PMI||Sep P||53.3||52||53.5||—|
|EC||Markit Eurozone Composite PMI||Sep P||52||50.4||51.9||—|
|IT||Italy Releases Revised National Accounts to 2018|
|HK||BoP Current Account Balance||2Q||—||$37.77b||$36.57b||$35.11b|
|US||Chicago Fed Nat Activity Index||Aug||0||—||-0.36||—|
|CA||Wholesale Trade Sales MoM||Jul||0.00%||—||0.60%||—|
|US||Markit US Manufacturing PMI||Sep P||50.4||—||50.3||—|
|US||Markit US Services PMI||Sep P||51.5||—||50.7||—|
|US||Markit US Composite PMI||Sep P||—||—||50.7||—|
|CA||Bloomberg Nanos Confidence||20-Sep||—||—||56.7||—|