China’s markets reopened today after being shut since January 23rd with unsurprising weakness. The Shanghai closed down 7.72% with the Shenzhen off 8.41%. Losses were broad with IT, Communication, Real Estate, Industrials, and Discretionary names off 9% or more. Health Care outperformed as you might imagine, down less than 3%. Note that over the same time period Hong Kong was off 7% with the US S&P down ~3.5%. The rest of Asian did not escape losses with the Nikkei easing lower on Consumer goods and IT. Down Under, Energy and Materials weighed with some strength seen in South Korea.
To support the economy China released a plethora of measures including a massive injection of CNY1.2T by the PBOC via reverse repos. Additionally, rates for both 7 and 14 day reverse repos were lowered by 10bps. Their securities regulator curtailed some futures restrictions with intra-government support for financing costs related to support of coronavirus-affected enterprises. Also, securities lending has said to be suspended beginning today as well. Unfortunately the death toll continues higher for the Wuhan coronavirus, approaching 400 with one death noted in the Philippines. Back to the economy, Industrial Profits in China fell 6.3% in December with Caixin PMI readings at 51.1 vs the 51.0 expected. With some factories still shut the NDRC said resumption of production will be on an ‘orderly basis’ with the ultimate impact uncertain at this point. Post the close the headlines noted the country will reassess their 2020 growth estimates in light of the coronavirus.
Hong Kong closed up small led by gains in Health Care, IT, Communications, and Discretionary names. Press there noted some companies will be allowed to report earnings late due to the cornonavirus. Evergrande RE +.4% said they will halt all on-site property sales in the mainland for 3 weeks with only online sales to occur until then.
In Japan, vehicle sales remained weak in January, off 11.1% which was worse than the 9.5% pullback prior. Down Under, Manufacturing PMI continued to contract in January with a 49.6 reading though better than the prior 49.1 result. Tomorrow, the RBA is expected to leave rates unchanged with only a ~20% chance currently of a rate cut expected. South Korean Manufacturing PMI eased a hair to 49.8 from 50.1 prior. Conversely, Taiwanese PMI rallied to 51.8 from 50.8 previously.
European markets have held steady today with a small skew to the upside. The balance of sectors up vs down is even with Tech names eking out small gains while Basic Resource and Energy names lag. PMI readings are in focus with most countries seeing better results. For the region, the Eurozone ticked a hair better, to 47.9 vs the expected and prior 47.8 readings. The UK moved to 50.0 with Germany and France also a bit better. Spain lagged but still bettered its past reading.
In individual names electronic payment firm Ingenico Group is up 12% with Worldline to acquire the firm in a €7.8B deal via cash and stock.
After missing its new net money target for the last year Julius Baer -5% instead plans to increase pretax profit by 10% this year. On that the firm is paring costs including releasing 5% of its salesforce.
Despite confirming its FY estimates Siemens Healthineers -4.5% missed on ebit. Margins were crimped with number lower down the page affected by taxes as well.
Norwegian sports retailer XXL +6% trades better with peer Gresvig filing bankruptcy. Gresvig has 95 self-owned stores with 100 franchised shops not included in the filing.
|AU||1)||AiG Perf of Mfg Index||Jan||—||45.4||48.3||—|
|AU||2)||CBA Australia PMI Mfg||Jan F||—||49.6||49.1||—|
|AU||3)||CoreLogic House Px MoM||Jan||—||0.90%||1.20%||—|
|AU||4)||Melbourne Institute Inflation MoM||Jan||—||0.30%||0.30%||—|
|AU||5)||Melbourne Institute Inflation YoY||Jan||—||1.80%||1.40%||—|
|AU||6)||Building Approvals MoM||Dec||-5.00%||-0.20%||11.80%||10.90%|
|AU||7)||Building Approvals YoY||Dec||-1.40%||2.70%||-3.80%||-2.80%|
|AU||8)||ANZ Job Advertisements MoM||Jan||—||3.80%||-6.70%||-5.70%|
|SK||9)||Markit South Korea PMI Mfg||Jan||—||49.8||50.1||—|
|JN||10)||Jibun Bank Japan PMI Mfg||Jan F||—||48.8||49.3||—|
|IR||11)||AIB Ireland PMI Mfg||Jan||—||51.4||49.5||—|
|CH||12)||Industrial Profits YoY||Dec||—||-6.30%||5.40%||—|
|CH||13)||Caixin China PMI Mfg||Jan||51||51.1||51.5||—|
|IN||14)||Markit India PMI Mfg||Jan||—||55.3||52.7||—|
|JN||15)||Vehicle Sales YoY||Jan||—||-11.10%||-9.50%||—|
|AU||16)||Commodity Index AUD||Jan||—||117.7||116.4||116.5|
|AU||17)||Commodity Index SDR YoY||Jan||—||-3.60%||-2.10%||-1.90%|
|SW||18)||Swedbank/Silf PMI Manufacturing||Jan||47.6||51.5||47.1||47.7|
|NO||19)||DNB/NIMA PMI Manufacturing||Jan||54.4||50.9||55.5||55|
|NE||20)||NEVI Netherlands Manufacturing PMI||Jan||—||49.9||48.3||—|
|SP||21)||Markit Spain Manufacturing PMI||Jan||48.7||48.5||47.4||—|
|HK||22)||GDP Annual YoY||2019||-1.40%||-1.20%||3.00%||2.90%|
|HK||24)||GDP YoY||4Q A||-3.90%||-2.90%||-2.90%||-2.80%|
|HK||25)||GDP SA QoQ||4Q A||-1.50%||-0.40%||-3.20%||-3.00%|
|IT||26)||Markit Italy Manufacturing PMI||Jan||47.3||48.9||46.2||—|
|FR||27)||Markit France Manufacturing PMI||Jan F||51||51.1||51||—|
|GE||28)||Markit/BME Germany Manufacturing PMI||Jan F||45.2||45.3||45.2||—|
|EC||29)||Markit Eurozone Manufacturing PMI||Jan F||47.8||47.9||47.8||—|
|SZ||30)||Domestic Sight Deposits CHF||31-Jan||—||503.7b||508.9b||—|
|SZ||31)||Total Sight Deposits CHF||31-Jan||—||588.7b||587.2b||—|
|GR||32)||Markit Greece Manufacturing PMI||Jan||—||54.4||53.9||—|
|UK||33)||Markit UK PMI Manufacturing SA||Jan F||49.8||50||49.8||—|
|DE||34)||Danish PMI Survey||Jan||—||53.2||50.7||51.1|
Note that trading in Mexico is shut today.