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Asian Headlines Even as mainland China closed lower today the balance of Asian bourses finished somewhat higher to close out a generally losing week for most. This was despite positive comments from President Trump calling China’s president a friend and that he hoped his country did well.  Australia managed a one percent gain for the week but others finished lower, led by losses of over 4% on the mainland and in Hong Kong.    Telcos and Health Care weighed in China while Energy and Financials led in Japan.  IT and Real Estate names pushed those two sectors to gains of over a percent.  To note, a press story out reported Morgan Stanley lowered their price target on the Hang Seng by 5% to 25,900. Economic releases were light in the region with Korean unemployment ticking up slightly to 3.8% in July from the previous +3.7% reading.  The gov noted job growth grew at the slowest pace since January of 2010 adding they will employ all tools to counter the slowness. Malaysia’s 2Q GDP reading rose a scant .3% QoQ prompting their central bank to lower their FY view to 5.0% from the prior 5.5-6.0% expectation. They cited weak crude palm…

A tough session in Europe (and elsewhere) with the aforementioned slew of headlines weighing on the States since our morning piece.   All sectors finished down with the Basic Resource sector down over 4% on the stronger Dollar with copper weaker by over 4%.  Big names like BHP -5.2% and Glencore -5.7% were sizable losers. Energy names were the second worst performer on the SXXP with the stronger Dollar coupling with the strong build in DOE Crude balances in the States to weigh.  Only 65 names finished higher on the SXXP with volume down 12% with several markets shut. Turkey remains front and center with their president reaching out to Merkel today concerning bilateral ties.   Qatar pledged $15B in investments to Turkey with focus probably into the financial/banking market.  Further, their cap mkts board in Turkey lowered their limit on leverage to 1 for 1 concerning new FX positions. South Africa was certainly an underperformer today, finishing off 3.4% on the All Share Index. Moodys earlier said GDP growth will be slower than expected with wage bills and land seizures pushing the country in the wrong direction.  Heavyweight Naspers fell 8.2% as it owns 31% of Tencent (currently off 6% in the…

Just before the US open European indices took another leg lower before rebounding off of lows to end down small on the day.  The rebound corresponded to the better US market coupled with Turkey’s FinMin making positive comments.  He noted capital ratios for the country’s banks remain above thresholds adding no significant outflows have been seen.  Both he and the president though continued with rhetoric against their perceived attack by the US. Moves sector-wise were also contained to +/- less than a percent today with Food and Personal goods names leading while Basic Resources and Autos slipped. Only 227 names finished with any gains while volume closed flat. Dental implant firm Straumann +4.5% gave its shareholders smiles after upping guidance for the FY as they see organic rev growth up in the mid-teens.  2Q organic growth was up 20.4%. Vehicle component-maker SAF-Holland +.7% closed off of highs post reporting it expects FY adjusted ebit margin at +7-8% for the year.  Strong sales for the 2Q were seen in Asia with margins strong in Europe. Atlantia -5.4% was weaker on the day as its Autostrade unit was currently working on the site of the bridge that fell in Genoa, Italy today.…

After shaking off earlier lows Europe was unable to get anything going after the US open with disappointing action seen there.  On that indices closed down on the day with Italy underperforming, down 75bps.  Only 212 names on the Stoxx 600 closed better with the summer doldrums continuing as volumes were off 13% of the already quiet action. On the aforementioned steps Turkey is taking to stem the selling in the Lira the currency did strengthen back over the 7 level vs the Dollar.   The Istanbul 100 slipped 2.4% on the day with the index holding Friday’s low before rebounding from that level. At the center of the tension Pastor Andrew Brunson is speculated to be released Wednesday but the US Embassy has downplayed that. Other emerging market names are faring much better with the iShares MSCI Emerging Mkt ETF selling off again to today and not that much above the late June low. The Italian 10 year closed above a 3% yield today as leaders there met with the ECB’s Draghi to plan for a possible selloff in assets there.  Spending and the budget deficit and its conflict with the EU is front and center with Deputy PM Di…

European indices hit lows roughly 40 minutes before the close before rebounding ever-so-slightly.  Losses in the region were varied with the UK a better performer with a loss of ~1% as the Pound continued to pull back.  Markets with financials with larger exposure to Turkey were hit harder with the Banking sector the second worst performer.  The Basic Materials sector matched losses with Banks, down 190bps with Autos and Chemicals not far behind. Back to Turkey, the White House may ratchet up tariffs to 50% on steel & aluminum against Turkey with the Lira plummeting.   Turkey’s President and FinMin have responded by upping the rhetoric with Russia siding with the troubled country as they too are facing hardball from President Trump. Novozymes -3.3% fell despite retaining their FY outlook after revs and NI were ahead of estimates in the 2Q. EBIT missed estimates with household care weaker and concern around the ag market.  The CEO made positive comments concerning growth in emerging markets but added trading concerns may weigh on Asian markets in the future. Casino -3.6% moved back to Wednesday’s lows after Bernstein ramped up their scrutiny of the firm and how they account for transactions with franchisees.  They allege…

Asian Markets A solid day as the Chinese markets led the region while a stronger ¥ and trouble in the auto sector caused Japan to lag.  A declaration by regulators (the CSRC) rules would be relaxed to permit greater market access to foreign funds drove the Chinese gains. This is an interesting development considering CNBC speculated the recent trade spat may spur further Chinese reform.  Additionally, Premier Li will spearhead initiatives regarding further technology development.  That caused IT to be among the region sector leaders with a 1% gain.  A strengthening yuan provided lift to the Chinese airlines.  Most other sectors were also green.  However, energy fell following yesterday’s crude decline due to the Chinese tariffs on U.S. related products. Chinese inflation was front in center on the macro front.  Both the July m/m and y/y results beat expectations.  The m/m result was an unexpected increase and the y/y advance was the largest since March.  PPI was also ahead of consensus.  Japan’s June core machine orders plunged much more than expected m/m with a miss on the y/y release, as well.  The government was forced to cut its assessment for the year. Other Important Headlines The Japanese auto sector was…

Asian Headlines Apart from Australia and Taiwan gains were broad today in Asia with China rebounding from yesterday’s selling. Both the Shanghai and Shenzhen rallied 2.75% with Energy, Industrials, and Materials among the leading sectors.  Hong Kong too rallied with Health Care, Autos, Gaming names, and Energy to the upside. Australia saw strength in Energy names there as well with Telcos and Material weighing.  After lunch the RBA announced they were again leaving rates unchanged.  The central bank said some one-off price declines will probably lead to FY18 inflation coming in a bit lower, at 1.75%. They noted some optimism on wage growth. Encouraging moves in earnings were seen in Japan with both labor cash and real cash earnings ahead of estimates.    One economic group attributed the move to bonus payments stemming from corporate profits as opposed to tightness in the labor market. Household Spending fell less than expected, seemingly trending away from slowing. Ahead of its IPO China Tower priced their shares at HK$1.26 which is on the lowest end of their estimated pricing range.  The stock will begin trading on the Hang Seng tomorrow with interest tepid at only 1.36 times. Post yesterday’s strong results on gains in…

Asian Markets The markets were mixed in the last trading day of the week.  Trade worries continued to weigh on China while S. Korea and India led the region.  Not helping Greater China was a decline in a Hong Kong PMI into contraction territory and Caixin Services PMI that missed.   The recent selling in Chinese equities leaves the market in third place behind Japan in terms of total capitalization.  S. Korea saw foreign investors turn buyers in some of the recently battered sectors: autos, construction and other deep cyclicals.  Overall, most sectors ended lower as Chinese names weighed.  Industrials, consumer staples, materials and real estate declined by c. 1%.  Telecoms were up small while utilities, financials and energy were flat. On the trade front, U.S. Commerce Sec. Ross stated, “We have to create a situation where it’s more painful for them (the Chinese) to continue their bad practices than it is to reform.”  In an interesting attempt to alleviate its own issues with the U.S., Japan is said to be considering a sovereign wealth fund that would invest in U.S. infrastructure.  In response to those reports, FM Aso said there was “no specific plan.” Import Headlines: The following Japanese names…

Asian Markets While the markets were once again mixed,  the moves were more dramatic today.   Japan posted solid gains thanks to a weakening ¥ which breached the 112 handle following yesterday’s BoJ announcements.  The majority of sectors there advanced with materials and financials better c. 2% while IT, health care, energy and utilities gained more than 1%.  S. Korea also advanced and Indonesia recouped yesterday’s losses. China and Hong Kong were another matter.  The region initially had mixed reaction to yesterday’s pledge of measured deleveraging from the Politburo.  There was disappointment for builders on the home price curb comments and some had hoped for more specific action to offset trade concerns.   Speaking of trade concerns, those added selling pressure to the region.  Reuters reported Pres. Trump is mulling even larger tariffs than discussed in July.  The initial indication was 10% tariffs on an additional $200b worth of Chinese imports. 25.0% is now being considered.  All of the major sectors in the Shanghai Composite were in the red.  Real estate gave way by 5%!   Adding to the sectors woes, Shenzhen announced new measures to alleviate price pressures. Other Important Headlines Apple suppliers were in focus following strong results from the iPhone…

Part of the Asian focus will be the BoJ’s policy meeting.  Ahead of tomorrow’s meeting, the credit markets are seeing bond yield dip across the globe.  There is growing sentiment Gov. Kuroda and company may adjust is bond purchase program and/or use other means to allow yields to fluctuate.  The other focal point will be China’s official PMI readings. Europe has EC CPI and GDP to be released. Here other important items Smartphone suppliers will be awaiting results from both Samsung Elec. and Apple.  Other macro out includes Japanese and S. Korean industrial production, German retail sales and employment change. Daiwa’s Q1 rose +9.7% with OP +3.4% while NI declined 4.4%.  It does not appear they provided an outlook.  They did announce a buyback up to 3.4% of capital for a value not to exceed ¥40b. Petrochina sees its H1 NI better by 122.0% y/y! Idea Cellular’s Q1 Revenues were INR 58.9b, EBITDA INR 6.6b and Q1 profit were INR 2.6.  That was a suprise due to a one time gain of INR 33.6b on the sale of its tower unit. Vivendi results out after today’s European close. Other earnings due include Credit Suisse, BP, Sanofi and Mizuho to name a…