International Summary

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CAPIS Global Recap – 10/15/2018

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International Summary

posted by Clayton Duff on 10/15/2018 at 6:38 am
by Clayton Duff on 10/15/2018

Asian Headlines Asian markets kicked off the week in disappointing fashion with losses continuing today. Japan led to the downside on broad sector losses with Communications and Consumer Discretionary names especially hit hard.  Hong Kong and the mainland only fared a bit better with Korea and Australia also seeing sizable losses. In China the aforementioned 100bps RRR cut that was announced a little over a week ago took effect today but did not seem to make much of a difference.  The PBoC skipped open market ops today adding they will not roll over maturing MLF loans today as well.  And further looking into China the Shanghai Securities News said the government of Shenzhen would provide tens of billions of yuan to support listed companies with liquidity. Japan reported Industrial Production for August that showed tepid growth and was well light prior readings.  Of interest the BoJ’s Kuroda said the signal from the central bank flagging a change from a policy of easy money will be a change in rates.  Also, PM Abe said sales taxes will increase next October as planned. Softbank -7.3% was the culprit in the communications space with its heavyweight standing a strong drag on the Japanese…

Asian Headlines Asian markets kicked off the week in disappointing fashion with losses continuing today. Japan led to the downside on broad sector losses with Communications and Consumer Discretionary names especially hit hard.  Hong Kong and the mainland only fared a bit better with Korea and Australia also seeing sizable losses. In China the aforementioned 100bps RRR cut that was announced a little over a week ago took effect today but did not seem to make much of a difference.  The PBoC skipped open market ops today adding they will not roll over maturing MLF loans today as well.  And further looking into China the Shanghai Securities News said the government of Shenzhen would provide tens of billions of yuan to support listed companies with liquidity. Japan reported Industrial Production for August that showed tepid growth and was well light prior readings.  Of interest the BoJ’s Kuroda said the signal from the central bank flagging a change from a policy of easy money will be a change in rates.  Also, PM Abe said sales taxes will increase next October as planned. Softbank -7.3% was the culprit in the communications space with its heavyweight standing a strong drag on the Japanese…

TGIF Global Markets 10/12/2018

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posted by Clayton Duff on 10/12/2018 at 11:01 am
by Clayton Duff on 10/12/2018

Asian Markets Selling abated early in the Asian markets with indices ending up on the session pushing US futures up over a percent at the close of Japanese trading.  Two stories provided the advance. Chinese trade data (more on this below) along with the U.S. Treasury report on the yuan.  In Japan, the recently hard-hit IT and Communications sector led with gains of over two percent.  Gains were much broader in Hong Kong with several sectors up 3-5% as IT led.  South Korea and India also experienced solid gains thanks to the tech rally with India’s indices up on the week. On a Dollar basis,  Chinese Exports grew 14.5% during September, well ahead of both estimates and the prior reading.  Imports grew but were a bit light vs. both readings leading to a larger trade surplus no-doubt to be used by the White House in trade discussions.  Specifically, exports to the U.S. rose 16.6% YoY while imports from the U.S. grew by less than 2%.   However, possibly easing the tension between the two superpowers, the U.S. Treasury has found that China is not manipulating the yuan.  Also, President Trump is said to be meeting with President Xi at the G-20…

Asian Markets Selling abated early in the Asian markets with indices ending up on the session pushing US futures up over a percent at the close of Japanese trading.  Two stories provided the advance. Chinese trade data (more on this below) along with the U.S. Treasury report on the yuan.  In Japan, the recently hard-hit IT and Communications sector led with gains of over two percent.  Gains were much broader in Hong Kong with several sectors up 3-5% as IT led.  South Korea and India also experienced solid gains thanks to the tech rally with India’s indices up on the week. On a Dollar basis,  Chinese Exports grew 14.5% during September, well ahead of both estimates and the prior reading.  Imports grew but were a bit light vs. both readings leading to a larger trade surplus no-doubt to be used by the White House in trade discussions.  Specifically, exports to the U.S. rose 16.6% YoY while imports from the U.S. grew by less than 2%.   However, possibly easing the tension between the two superpowers, the U.S. Treasury has found that China is not manipulating the yuan.  Also, President Trump is said to be meeting with President Xi at the G-20…

CAPIS Global Markets 10/11/2018

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posted by Clayton Duff on 10/11/2018 at 10:43 am
by Clayton Duff on 10/11/2018

Markets Overview The selling certainly did not stop with North America as weakness in equities only accelerated overnight.  Asian markets suffered multiple percentage point declines.  Losses of over 4% were common with Energy and Industrials joining Tech names as serious underperformers.  In Hong Kong, losses of 7% were commonplace in the Tech space with defensive names even seeing sizable losses. The tech-heavy Taiwan TWSE was also in focus with sharp losses there, as well.  Utilities were the best performing sector but were still lower on the day by 2.5%.  Within basic resources, gold names were a bright spot outperforming in a flight to safety. The Yen continued to strengthen as it looks to move through the 112 level vs the Dollar.  To the flip, side the Yuan is again weaker, threatening to move through mid-August levels on its way to 7 Renminbi to the Dollar. Europe opened down c. 1.8% hitting lows about 4 hours into the session of c. 2%.  At one point, less than 40 names in the Euro Stoxx 600 were to the upside.  However, the markets managed to pare some of the losses helped in part by the U.S. CPI data which came in a touch…

Markets Overview The selling certainly did not stop with North America as weakness in equities only accelerated overnight.  Asian markets suffered multiple percentage point declines.  Losses of over 4% were common with Energy and Industrials joining Tech names as serious underperformers.  In Hong Kong, losses of 7% were commonplace in the Tech space with defensive names even seeing sizable losses. The tech-heavy Taiwan TWSE was also in focus with sharp losses there, as well.  Utilities were the best performing sector but were still lower on the day by 2.5%.  Within basic resources, gold names were a bright spot outperforming in a flight to safety. The Yen continued to strengthen as it looks to move through the 112 level vs the Dollar.  To the flip, side the Yuan is again weaker, threatening to move through mid-August levels on its way to 7 Renminbi to the Dollar. Europe opened down c. 1.8% hitting lows about 4 hours into the session of c. 2%.  At one point, less than 40 names in the Euro Stoxx 600 were to the upside.  However, the markets managed to pare some of the losses helped in part by the U.S. CPI data which came in a touch…

CAPIS Global Markets 10/10/2018

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posted by Clayton Duff on 10/10/2018 at 11:23 am
by Clayton Duff on 10/10/2018

Asian Markets Much like the US, moves were slight with the markets ending the day mixed.  South Korea saw heavy selling following yesterday’s holiday while India had a much needed rebound with the Nifty 50 able to move a bit above the 400 day mavg.  Financials lead there after State Bank of India +5.6% pledged to triple its purchase of loans. On the economic front, Japan reported Core Machine orders up 6.8% in August, well ahead of the 3.9% slide expected but light the 11% growth in July.  Down Under, Consumer Confidence as measured by Westpac saw a stop in the slide over the prior 3 months with a reading of 101.5. HK’s Chief Executive made a policy address today noting e-cigarettes will be banned adding they will increase the land supply for public housing.  He said 70% of new land supply will go towards public housing.  Additionally, he added any behavior towards promoting HK independence will not be tolerated Despite being downgraded to Neutral at Macquarie, PetroChina +0.15% is again higher after being a positive standout yesterday.  The firm stopped imports of oil from the US in August while dramatically reducing gas imports upon the 25% tariff China placed…

Asian Markets Much like the US, moves were slight with the markets ending the day mixed.  South Korea saw heavy selling following yesterday’s holiday while India had a much needed rebound with the Nifty 50 able to move a bit above the 400 day mavg.  Financials lead there after State Bank of India +5.6% pledged to triple its purchase of loans. On the economic front, Japan reported Core Machine orders up 6.8% in August, well ahead of the 3.9% slide expected but light the 11% growth in July.  Down Under, Consumer Confidence as measured by Westpac saw a stop in the slide over the prior 3 months with a reading of 101.5. HK’s Chief Executive made a policy address today noting e-cigarettes will be banned adding they will increase the land supply for public housing.  He said 70% of new land supply will go towards public housing.  Additionally, he added any behavior towards promoting HK independence will not be tolerated Despite being downgraded to Neutral at Macquarie, PetroChina +0.15% is again higher after being a positive standout yesterday.  The firm stopped imports of oil from the US in August while dramatically reducing gas imports upon the 25% tariff China placed…

CAPIS Global Markets 10/9/2018

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posted by Clayton Duff on 10/09/2018 at 11:07 am
by Clayton Duff on 10/09/2018

Asian Markets The Nikkei reopened today down ~1% and held steady there the balance of the session.   IT names saw sizable losses, inline with other regions in the world as Materials and Communications also slipped.   The Hang Seng ended the day down small after yesterday ending under the mid-September pullback that prompted the talking heads to report the index was off over 20% from highs.  Energy was the leader to the upside with RE also holding in well. Following yesterday’s sizable losses in China, it was a welcome sight to see some green on both the Shanghai and Shenzhen even as gains were kept in check.  South Korea was shut for Hangul Day while India held above yesterday’s lows. With the ¥ strengthening for the 4th consecutive day and  following 3 day weekend, Japan was set to play “catch down” with IMF headlines no help.  They lowered both FY18 and ’19 GDP forecasts citing escalating trade conflicts and tighter financial conditions. Emerging markets as whole saw sharp cuts to growth with Argentina, Brazil, Iran, and Turkey accounting for much of weakness. With China looking to clean up the environment, liquid natural gas has been focused on to reduce coal use. …

Asian Markets The Nikkei reopened today down ~1% and held steady there the balance of the session.   IT names saw sizable losses, inline with other regions in the world as Materials and Communications also slipped.   The Hang Seng ended the day down small after yesterday ending under the mid-September pullback that prompted the talking heads to report the index was off over 20% from highs.  Energy was the leader to the upside with RE also holding in well. Following yesterday’s sizable losses in China, it was a welcome sight to see some green on both the Shanghai and Shenzhen even as gains were kept in check.  South Korea was shut for Hangul Day while India held above yesterday’s lows. With the ¥ strengthening for the 4th consecutive day and  following 3 day weekend, Japan was set to play “catch down” with IMF headlines no help.  They lowered both FY18 and ’19 GDP forecasts citing escalating trade conflicts and tighter financial conditions. Emerging markets as whole saw sharp cuts to growth with Argentina, Brazil, Iran, and Turkey accounting for much of weakness. With China looking to clean up the environment, liquid natural gas has been focused on to reduce coal use. …

Health Sports Day Global Markets 10/8/2018

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posted by Clayton Duff on 10/08/2018 at 12:47 pm
by Clayton Duff on 10/08/2018

Asian Markets It was a particularly nasty session in China following last week’s long holiday.  This was despite several bits of information that normally provides support to the markets.  One was the reserve rate requirement cut of 1% for some banks, bringing the requirement to 14.50%.   The move was said to free up CNY1.2T in funds for small businesses.  However, markets took the view this was done to prop up a slowing economy facing a growing trade threat with the U.S. If you recall, last week showed slowing Manufacturining PMI readings.   The second positive was the Caixin PMI readings for both Services and the Composite reading were out with an impressive result for Services.  For September, PMI Services rose to 53.1, well ahead of the 51.4 expected and nicely ahead of the 51.5 prior reading. The Composite was 52.1 vs 52.0 prior.  Losses in China were broad and deep with Consumer goods taking a drubbing along with IT names on the spy-chip concerns from last week.  On that, China addressed the problem today announcing officials can inspect IT companies.  Another space that saw weakness was the gaming space which slipped after Morgan Stanley said the 3Q may disappoint on…

Asian Markets It was a particularly nasty session in China following last week’s long holiday.  This was despite several bits of information that normally provides support to the markets.  One was the reserve rate requirement cut of 1% for some banks, bringing the requirement to 14.50%.   The move was said to free up CNY1.2T in funds for small businesses.  However, markets took the view this was done to prop up a slowing economy facing a growing trade threat with the U.S. If you recall, last week showed slowing Manufacturining PMI readings.   The second positive was the Caixin PMI readings for both Services and the Composite reading were out with an impressive result for Services.  For September, PMI Services rose to 53.1, well ahead of the 51.4 expected and nicely ahead of the 51.5 prior reading. The Composite was 52.1 vs 52.0 prior.  Losses in China were broad and deep with Consumer goods taking a drubbing along with IT names on the spy-chip concerns from last week.  On that, China addressed the problem today announcing officials can inspect IT companies.  Another space that saw weakness was the gaming space which slipped after Morgan Stanley said the 3Q may disappoint on…

CAPIS Global Recap – 10/5/2018

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posted by Clayton Duff on 10/05/2018 at 6:45 am
by Clayton Duff on 10/05/2018

Asian Headlines Another lower close in the region overnight with India again leading to the downside.   Australia managed a small gain and has largely escaped the selling this week with the ASX200 down only .36% the last five days.  Hong Kong was down small on the day with the beaten-up Health Care sector rebounding today while IT saw losses over 2%. As mentioned the Sensex 30 again was lower with index down over 11% since the first of September. The Rupee weakened again 5:00 EST after the RBI left their repurchase rate at 6.5% surprising the market which expected a hike to 6.75%.  The central bank maintained their FY 18/19 GDP growth view but amended their stance from neutral to a calibrated tightening. On benign food prices 2H CPI views were cut fairly sharply allowing for the lack of rate change. Japan reported labor cash earnings up .9% in August on YoY basis but that revealed a slowing vs the previous reading and was light estimates.  To the upside Household Spending leapt 2.8% YoY in August, well ahead of the tepid estimate and prior reading. Interestingly, the BoJ quarterly public opinion of household sentiment noted the public sees inflation running…

Asian Headlines Another lower close in the region overnight with India again leading to the downside.   Australia managed a small gain and has largely escaped the selling this week with the ASX200 down only .36% the last five days.  Hong Kong was down small on the day with the beaten-up Health Care sector rebounding today while IT saw losses over 2%. As mentioned the Sensex 30 again was lower with index down over 11% since the first of September. The Rupee weakened again 5:00 EST after the RBI left their repurchase rate at 6.5% surprising the market which expected a hike to 6.75%.  The central bank maintained their FY 18/19 GDP growth view but amended their stance from neutral to a calibrated tightening. On benign food prices 2H CPI views were cut fairly sharply allowing for the lack of rate change. Japan reported labor cash earnings up .9% in August on YoY basis but that revealed a slowing vs the previous reading and was light estimates.  To the upside Household Spending leapt 2.8% YoY in August, well ahead of the tepid estimate and prior reading. Interestingly, the BoJ quarterly public opinion of household sentiment noted the public sees inflation running…

CAPIS Global Recap – 10/4/2018

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posted by Clayton Duff on 10/04/2018 at 7:04 am
by Clayton Duff on 10/04/2018

Asian Headlines Asian indices were mostly lower with Hong Kong down by 173bps on the session as Health Care, Energy, and IT names weighed heavily. The Nikkei too was lower but at a much smaller amount with Energy and Financials though providing support as Health Care was the laggard there as well.  The Kospi also lagged with India’s Sensex Index down big as it moved through the 200 day.  The Rupee continued its march lower, now at 73 and change vs the Dollar.  The BoK’s Governor Lee was reported to have indicated a rate hike is imminent which would  surprise the market considering weakening in the economy. He noted imbalances in many sectors while adding the need for an investment-friendly environment.  Watch tonight for inflation readings in Korea with a MoM slowdown expected for September even as a YoY increase is expected. Hong Kong’s PMI for September continued to contract, coming in at 47.9 which was below the 48.5 prior reading.  While all sectors weighed some names saw gains with ZTE up .9% despite a US court extending its probation.  In a deal signed by ZTE a district court based in Texas will observe the company until 2022, instead of…

Asian Headlines Asian indices were mostly lower with Hong Kong down by 173bps on the session as Health Care, Energy, and IT names weighed heavily. The Nikkei too was lower but at a much smaller amount with Energy and Financials though providing support as Health Care was the laggard there as well.  The Kospi also lagged with India’s Sensex Index down big as it moved through the 200 day.  The Rupee continued its march lower, now at 73 and change vs the Dollar.  The BoK’s Governor Lee was reported to have indicated a rate hike is imminent which would  surprise the market considering weakening in the economy. He noted imbalances in many sectors while adding the need for an investment-friendly environment.  Watch tonight for inflation readings in Korea with a MoM slowdown expected for September even as a YoY increase is expected. Hong Kong’s PMI for September continued to contract, coming in at 47.9 which was below the 48.5 prior reading.  While all sectors weighed some names saw gains with ZTE up .9% despite a US court extending its probation.  In a deal signed by ZTE a district court based in Texas will observe the company until 2022, instead of…

CAPIS EU Close – 10/3/2018

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posted by Clayton Duff on 10/03/2018 at 12:48 pm
by Clayton Duff on 10/03/2018

Asian indices closed mixed with the Nikkei down post PMI Services hitting a 2 year low though staying in expansionary range. The recent earthquake was cited.  The ¥ weakened again but that was little help to exporters will all but Health Care and Utilities lower on the day with Energy and Financial names underperforming.   Down Under, Building Approvals missed big with apartment approvals off big. In Europe indices finished modestly higher with Switzerland and Italy the better performers.  Germany was shut for Unity Day.  Italy has evidently pared its deficit target for 2020 down to 2.1% with the next year expected at 1.8%.  On that Italian bonds were bid up with the 10 year yield down to 3.306%.  PMI Services were better there as well.  We should get more clarity tomorrow with the budget plan to be submitted to parliament Thursday with one official noting any reduction in deficit targets will be tied to GDP growth. Apart from Italy, Service PMI readings missed in Spain, the UK, and Germany while France was ahead of estimates.  In the equity markets all but the Retail sector finished up with gains of over a percent in Telcos and Media. Providing strength in the…

Asian indices closed mixed with the Nikkei down post PMI Services hitting a 2 year low though staying in expansionary range. The recent earthquake was cited.  The ¥ weakened again but that was little help to exporters will all but Health Care and Utilities lower on the day with Energy and Financial names underperforming.   Down Under, Building Approvals missed big with apartment approvals off big. In Europe indices finished modestly higher with Switzerland and Italy the better performers.  Germany was shut for Unity Day.  Italy has evidently pared its deficit target for 2020 down to 2.1% with the next year expected at 1.8%.  On that Italian bonds were bid up with the 10 year yield down to 3.306%.  PMI Services were better there as well.  We should get more clarity tomorrow with the budget plan to be submitted to parliament Thursday with one official noting any reduction in deficit targets will be tied to GDP growth. Apart from Italy, Service PMI readings missed in Spain, the UK, and Germany while France was ahead of estimates.  In the equity markets all but the Retail sector finished up with gains of over a percent in Telcos and Media. Providing strength in the…

CAPIS EU Close – 10/2/2018

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posted by Clayton Duff on 10/02/2018 at 12:42 pm
by Clayton Duff on 10/02/2018

European indices managed to rebound from earlier lows except for Spain which retested those levels ending just a hair above lows.  With that said losses on the day were fairly subdued despite Industrials, Retail, Travel, and Media all weaker by over a percent.  Basic Resources, Utilities, and Autos finished somewhat higher on the day with copper rebounding today.    Volume on the session was up 20%.   Oil prices are flattish despite Iran’s OilMin noting OPEC has no additional capacity to produce more oil. As noted Italian budget concerns continue to steer sentiment with their ten year bond up 15pbs to 3.445%…up over 300bps vs the German 10 year bund yield of .42%.  Today’s comment by their lower house budget committee head Borghi suggesting Italy leave the EU and return to the Lira spooked markets even as he tried walking back the comment as nothing more than a personal view. Royal Mail fell another 8.4% today post yesterday’s disappointing FY operating profit view.   In the last two days the stock is off just over 24%. HVAC firm Ferguson’s stock cooled by nearly 7% today on noting they see UK trading profits lower citing challenging markets. Overall and US-specific sales were solid…

European indices managed to rebound from earlier lows except for Spain which retested those levels ending just a hair above lows.  With that said losses on the day were fairly subdued despite Industrials, Retail, Travel, and Media all weaker by over a percent.  Basic Resources, Utilities, and Autos finished somewhat higher on the day with copper rebounding today.    Volume on the session was up 20%.   Oil prices are flattish despite Iran’s OilMin noting OPEC has no additional capacity to produce more oil. As noted Italian budget concerns continue to steer sentiment with their ten year bond up 15pbs to 3.445%…up over 300bps vs the German 10 year bund yield of .42%.  Today’s comment by their lower house budget committee head Borghi suggesting Italy leave the EU and return to the Lira spooked markets even as he tried walking back the comment as nothing more than a personal view. Royal Mail fell another 8.4% today post yesterday’s disappointing FY operating profit view.   In the last two days the stock is off just over 24%. HVAC firm Ferguson’s stock cooled by nearly 7% today on noting they see UK trading profits lower citing challenging markets. Overall and US-specific sales were solid…

CAPIS Global Markets 10/02/2018

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posted by Matthew Kiselica on 10/02/2018 at 6:24 am
by Matthew Kiselica on 10/02/2018

Asian Markets A fairly brutal trading day as Hong Kong reopened from yesterday’s holiday and the Mainland Chinese markets remained closed.  India was also closed.  Hong Kong sentiment was already going to be dampened due to the weekends worrisome Chinese manufacturing and Macau gaming revenue data. (Here’s yesterday’s recap if you need the figures again.)  However, the real cause for investor anxiety is trade.  White House Economic Advisor Kudlow declared a trade agreement with China was not “imminent” and President Trump has not been pleased with progress.  There is also thought with successes in multiple trade negotiations, Pres. Trump will be encouraged to maintain a tough stance with China.  Adding to Sino-U.S. tension was a report a Chinese and U.S. naval vessel had a near collision in a disputed area of the South China Sea.  If that isn’t enough for you, investors were also worried about Italy which we will address below. The day’s one bright spot was Japan which managed to make some small headway.   Energy provided a large boost and autos also helped with the uptick.  Several manufacturers were seen as a beneficiary of the trade progress in N. America.  However, across the region the markets saw different…

Asian Markets A fairly brutal trading day as Hong Kong reopened from yesterday’s holiday and the Mainland Chinese markets remained closed.  India was also closed.  Hong Kong sentiment was already going to be dampened due to the weekends worrisome Chinese manufacturing and Macau gaming revenue data. (Here’s yesterday’s recap if you need the figures again.)  However, the real cause for investor anxiety is trade.  White House Economic Advisor Kudlow declared a trade agreement with China was not “imminent” and President Trump has not been pleased with progress.  There is also thought with successes in multiple trade negotiations, Pres. Trump will be encouraged to maintain a tough stance with China.  Adding to Sino-U.S. tension was a report a Chinese and U.S. naval vessel had a near collision in a disputed area of the South China Sea.  If that isn’t enough for you, investors were also worried about Italy which we will address below. The day’s one bright spot was Japan which managed to make some small headway.   Energy provided a large boost and autos also helped with the uptick.  Several manufacturers were seen as a beneficiary of the trade progress in N. America.  However, across the region the markets saw different…

CAPIS EU Close – 10/1/2018

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posted by Clayton Duff on 10/01/2018 at 12:18 pm
by Clayton Duff on 10/01/2018

Most indices held onto small gains to end the day marginally higher. Italy pared its gains, ending down 49bps on the MIB with selling in their sovereign debt.  At the end of the equity trading locally the ten year moved up 15bps to 3.29%.  On a sector view Tech and Chemicals retained their strength, up 1.37% and 1.13% respectively.  Energy also hung in well with WTI higher today and just shy of $75.00.  Banks finished to the downside along with Telcos and Travel names. The Pound leapt higher post lunch today on word PM May may concede some to the EU concerning the Irish border but gains were short-lived with the currency currently flat against the Dollar.   With that said the FTSE closed down despite some strength in IT and RE names. In a move reminiscent of the price increase curtailment attempts by the Chinese government PM May has floated the idea of increasing the stamp duty on individuals and companies that that purchase UK properties.  Whether for speculation or to house employees overseas buyers represent ~half of residential transactions in central London.   Berkeley Group -3.4% has an elevated exposure to the area.   Barratt Developments -1.6%, Taylor Wimpey -2%, and Crest…

Most indices held onto small gains to end the day marginally higher. Italy pared its gains, ending down 49bps on the MIB with selling in their sovereign debt.  At the end of the equity trading locally the ten year moved up 15bps to 3.29%.  On a sector view Tech and Chemicals retained their strength, up 1.37% and 1.13% respectively.  Energy also hung in well with WTI higher today and just shy of $75.00.  Banks finished to the downside along with Telcos and Travel names. The Pound leapt higher post lunch today on word PM May may concede some to the EU concerning the Irish border but gains were short-lived with the currency currently flat against the Dollar.   With that said the FTSE closed down despite some strength in IT and RE names. In a move reminiscent of the price increase curtailment attempts by the Chinese government PM May has floated the idea of increasing the stamp duty on individuals and companies that that purchase UK properties.  Whether for speculation or to house employees overseas buyers represent ~half of residential transactions in central London.   Berkeley Group -3.4% has an elevated exposure to the area.   Barratt Developments -1.6%, Taylor Wimpey -2%, and Crest…

CAPIS Global Markets 10/01/2018

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posted by Matthew Kiselica on 10/01/2018 at 6:47 am
by Matthew Kiselica on 10/01/2018

Asian Markets A mix for the region with both Hong Kong and the mainland Chinese markets closed.  Hong Kong reopens tomorrow but China will remain closed the rest of the week.  Japan advanced while Australia continues to see weakness among financials following a critical regulatory report.  Indonesia saw modest selling pressure following Friday’s tragic earthquake and tsunami.  Most sectors ended the day down small.  Consumer discretionary shares were off shy of 0.5% while IT gains a touch more than that mark. Other Important Headlines Despite the holiday, China published important macroeconomic data.  The official Chinese September manufacturing PMI missed consensus and hit a 7 month low.  The Caixin Chinese manufacturing PMI also fell short of estimates, declining to the critical 50 level.  The result is a 16 month low. The Japanese Tankan Survey results were generally light of expectations. September Macau Gambling Revenue rose 2.8% y/y to Patacas 22b.  The market was expecting +6.5% y/y. In Japan, Typhoon Trami made landfall in Japan forcing East Japan Railway -2.1% to shutdown several lines while airlines canceled flights. A third party investigator discovered additional instances of false data at Subaru -2.1%. Mitsubishi Corp. +1.5%, Petrochina +1.8% and RD Shell +0.5% are part of…

Asian Markets A mix for the region with both Hong Kong and the mainland Chinese markets closed.  Hong Kong reopens tomorrow but China will remain closed the rest of the week.  Japan advanced while Australia continues to see weakness among financials following a critical regulatory report.  Indonesia saw modest selling pressure following Friday’s tragic earthquake and tsunami.  Most sectors ended the day down small.  Consumer discretionary shares were off shy of 0.5% while IT gains a touch more than that mark. Other Important Headlines Despite the holiday, China published important macroeconomic data.  The official Chinese September manufacturing PMI missed consensus and hit a 7 month low.  The Caixin Chinese manufacturing PMI also fell short of estimates, declining to the critical 50 level.  The result is a 16 month low. The Japanese Tankan Survey results were generally light of expectations. September Macau Gambling Revenue rose 2.8% y/y to Patacas 22b.  The market was expecting +6.5% y/y. In Japan, Typhoon Trami made landfall in Japan forcing East Japan Railway -2.1% to shutdown several lines while airlines canceled flights. A third party investigator discovered additional instances of false data at Subaru -2.1%. Mitsubishi Corp. +1.5%, Petrochina +1.8% and RD Shell +0.5% are part of…

TGIF European Markets 9/28/2018

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posted by Matthew Kiselica on 09/28/2018 at 12:46 pm
by Matthew Kiselica on 09/28/2018

Following our morning note, the best that could be said is the region at least managed to close off the day’s lows.  The markets tracked trading in Milan which closed down 3.7% which was a percentage point improvement from its steepest decline.  With two exceptions all the major sectors closed lower.  It should come as no surprise banks were off more than 2.5% and insurers more than 1.5% with Italian names weighing.  Many of those names were limit down at times today.  Telecoms, autos, and tech also suffered losses of more than 1%.  The only two major sectors to manage minor advances were consumer staples and travel related names. The Italian 10 yr. yield soared 25.0% with other maturities seeing similar advances.  Core European yields fell in a flight to quality.  The € dipped below 1.16 before paring losses to the low 1.16s. The names we highlighted this morning last traded as follows: Intesa Sanpaolo -8.4%, Unicredit -6.7%, Serco +10.8%, BASF -2.3%, RSA Ins. -9.3% and Saab +8.1%. Some of the Day’s Other Headlines Auto parts supplier, Knorr-Bremse set is IPO range at €72-€87 per share.  That range values the company between €11.6 to €14b. Accenture’s CEO said his company…

Following our morning note, the best that could be said is the region at least managed to close off the day’s lows.  The markets tracked trading in Milan which closed down 3.7% which was a percentage point improvement from its steepest decline.  With two exceptions all the major sectors closed lower.  It should come as no surprise banks were off more than 2.5% and insurers more than 1.5% with Italian names weighing.  Many of those names were limit down at times today.  Telecoms, autos, and tech also suffered losses of more than 1%.  The only two major sectors to manage minor advances were consumer staples and travel related names. The Italian 10 yr. yield soared 25.0% with other maturities seeing similar advances.  Core European yields fell in a flight to quality.  The € dipped below 1.16 before paring losses to the low 1.16s. The names we highlighted this morning last traded as follows: Intesa Sanpaolo -8.4%, Unicredit -6.7%, Serco +10.8%, BASF -2.3%, RSA Ins. -9.3% and Saab +8.1%. Some of the Day’s Other Headlines Auto parts supplier, Knorr-Bremse set is IPO range at €72-€87 per share.  That range values the company between €11.6 to €14b. Accenture’s CEO said his company…

CAPIS Global Recap – 9/28/2018

News Trading Desk International Summary

International Summary

posted by Clayton Duff on 09/28/2018 at 6:55 am
by Clayton Duff on 09/28/2018

Asian Headlines Asian markets wrapped up the week with most indices closing higher, led by Japan and mainland China.  For the week the Nikkei closed up 1.88% with HK up 1.13%.  Shanghai and the Shenzhen were up 3.37% and 1.52% respectively while the Kospi gained 1.48%.  Australia saw small gains with India down on the week.   Note that next week China will be shut all week in celebration of their second Golden Week of the year, namely the National Day Golden Week.  Hong Kong will be shut Monday only. On the day Telcos rallied in Japan with the sector up over 3% with gains broad across the board.   Telcos were joined by Energy names as winners in Hong Kong with Autos and Gaming names up on the mainland.  Financials and Utilities saw gains of over a percent in Australia. Japanese CPI ticked up slightly in September, registering up 1.3% which was ahead of the prior reading of 1.2% and the estimate of 1.1%.  Industrial Production MoM turned positive again but both the MoM and YoY readings were light estimates. Retail sales beat both estimates and prior readings as well.  Note that the BoJ lowered planned bond purchases for next month…

Asian Headlines Asian markets wrapped up the week with most indices closing higher, led by Japan and mainland China.  For the week the Nikkei closed up 1.88% with HK up 1.13%.  Shanghai and the Shenzhen were up 3.37% and 1.52% respectively while the Kospi gained 1.48%.  Australia saw small gains with India down on the week.   Note that next week China will be shut all week in celebration of their second Golden Week of the year, namely the National Day Golden Week.  Hong Kong will be shut Monday only. On the day Telcos rallied in Japan with the sector up over 3% with gains broad across the board.   Telcos were joined by Energy names as winners in Hong Kong with Autos and Gaming names up on the mainland.  Financials and Utilities saw gains of over a percent in Australia. Japanese CPI ticked up slightly in September, registering up 1.3% which was ahead of the prior reading of 1.2% and the estimate of 1.1%.  Industrial Production MoM turned positive again but both the MoM and YoY readings were light estimates. Retail sales beat both estimates and prior readings as well.  Note that the BoJ lowered planned bond purchases for next month…

CAPIS European Markets 9/27/2018

News Trading Desk International Summary

International Summary

posted by Matthew Kiselica on 09/27/2018 at 12:48 pm
by Matthew Kiselica on 09/27/2018

The markets ended the day at the highs of the day steadily moving higher following our morning note.  News from Italy remains contradictory.  However, Italian equities and bonds pared sharper declines.  Interestingly, the € did not see the same recovery despite German inflation increasing more than estimated.  However, the USD was generally strong following yesterday’s Fed meeting.  The Italian concerns had a contagion effect upon Spain which closed flat. Most sectors advanced to one extent or another.  Telecoms gained close to 1% followed by personal goods and retail.  Basic resources and chemicals were lower by less than 0.5%.  The stronger USD is weighing upon most commodity prices. The names we highlighted this morning last traded as follows:  H&M +11.1%, Julius Baer -0.6%, Danske Bk -1.3% & Indivior -13.0%. Some of the Day’s Other Highlights Thyssenkrupp +9.9% confirmed earlier reports the company would split into two companies  The new entities will be Tyssenkrupp Industrials and Thyssenkrupp Materials.  The former will comprise of the elevator, auto supply and construction units.  The latter will be the steel and material units. Carnival -5.2% sank below its 200 mavg. following results.  The company sees fuel costs and currency headwinds weighing upon FY earnings. The Italian…

The markets ended the day at the highs of the day steadily moving higher following our morning note.  News from Italy remains contradictory.  However, Italian equities and bonds pared sharper declines.  Interestingly, the € did not see the same recovery despite German inflation increasing more than estimated.  However, the USD was generally strong following yesterday’s Fed meeting.  The Italian concerns had a contagion effect upon Spain which closed flat. Most sectors advanced to one extent or another.  Telecoms gained close to 1% followed by personal goods and retail.  Basic resources and chemicals were lower by less than 0.5%.  The stronger USD is weighing upon most commodity prices. The names we highlighted this morning last traded as follows:  H&M +11.1%, Julius Baer -0.6%, Danske Bk -1.3% & Indivior -13.0%. Some of the Day’s Other Highlights Thyssenkrupp +9.9% confirmed earlier reports the company would split into two companies  The new entities will be Tyssenkrupp Industrials and Thyssenkrupp Materials.  The former will comprise of the elevator, auto supply and construction units.  The latter will be the steel and material units. Carnival -5.2% sank below its 200 mavg. following results.  The company sees fuel costs and currency headwinds weighing upon FY earnings. The Italian…

CAPIS Global Recap – 9/27/2018

News Trading Desk International Summary

International Summary

posted by Clayton Duff on 09/27/2018 at 6:42 am
by Clayton Duff on 09/27/2018

Asian Headlines Asia took the cue from the US and closed lower on the session with Japan and China’s Shenzhen leading lower.  Apart from consumer discretionary names all sectors were weaker on the Nikkei with losses of over 2% in IT and Energy names. IT too was a laggard in China with slowing growth in Industrial Profits predicating weakness in the region. YoY profit growth grew 9.2% in August, well below the prior reading of 16.2% making it the slowest pace since March.  Also on the economic front Hong Kong reported after the close strong growth in both imports and exports with their trade deficit widening in August.  To note, HSBC upped their HK prime rate 12.5bps overnight to 5 1/8% which was the first increase in 12 years. This was post HK increasing their base rate to 2.5% following the move in the States.  Other banks made similar moves as well.  On the tariff front China said they will lower the average tariff rate on over 1500 goods to 7.5% from 9.5%. In an encouraging move the FTSE Russell said they will assign secondary emerging market status to Chinese A share next summer with names to be added then. …

Asian Headlines Asia took the cue from the US and closed lower on the session with Japan and China’s Shenzhen leading lower.  Apart from consumer discretionary names all sectors were weaker on the Nikkei with losses of over 2% in IT and Energy names. IT too was a laggard in China with slowing growth in Industrial Profits predicating weakness in the region. YoY profit growth grew 9.2% in August, well below the prior reading of 16.2% making it the slowest pace since March.  Also on the economic front Hong Kong reported after the close strong growth in both imports and exports with their trade deficit widening in August.  To note, HSBC upped their HK prime rate 12.5bps overnight to 5 1/8% which was the first increase in 12 years. This was post HK increasing their base rate to 2.5% following the move in the States.  Other banks made similar moves as well.  On the tariff front China said they will lower the average tariff rate on over 1500 goods to 7.5% from 9.5%. In an encouraging move the FTSE Russell said they will assign secondary emerging market status to Chinese A share next summer with names to be added then. …

CAPIS EU Close – 9/26/2018

News Trading Desk International Summary

International Summary

posted by Clayton Duff on 09/26/2018 at 12:42 pm
by Clayton Duff on 09/26/2018

Ahead of the US Fed this afternoon market managed to take a view and move higher on the day albeit on tepid gains.   As noted the stronger Pound weighed a bit in the UK with the FTSE 100 flat on the day post word of lower tax rates.  Italy ended a hair lower on the aforementioned demand by 5-Star with a budget deficit of 2.4-2.5% preferred.  This contradicts the EconMin’s desire for a 1.9-2.0% level. Hopefully tomorrow’s budget target meeting will produce a consensus. On a sector basis travel name along with Food and Media led on the session with Basic Resources slipping as miners pulled back.  The Stoxx 600 saw 332 names to the upside while 255 slipped as volume fell 8% on the day. Pharmaceutical firm Indivior initially gapped up on its FY revenue guidance but ultimately fell 16% on the day after reducing expected net revenues for its Sublocade drug to $8-$10M from the prior $25-50M view. Insurance reimbursements still seem to be of concern. To the upside Airbus +3.2% is pursuing a deal with China for $18B in jet sales. In the face of a threatened 25% tariff on Boeing 737 narrow-bodied jets Airbus is hoping…

Ahead of the US Fed this afternoon market managed to take a view and move higher on the day albeit on tepid gains.   As noted the stronger Pound weighed a bit in the UK with the FTSE 100 flat on the day post word of lower tax rates.  Italy ended a hair lower on the aforementioned demand by 5-Star with a budget deficit of 2.4-2.5% preferred.  This contradicts the EconMin’s desire for a 1.9-2.0% level. Hopefully tomorrow’s budget target meeting will produce a consensus. On a sector basis travel name along with Food and Media led on the session with Basic Resources slipping as miners pulled back.  The Stoxx 600 saw 332 names to the upside while 255 slipped as volume fell 8% on the day. Pharmaceutical firm Indivior initially gapped up on its FY revenue guidance but ultimately fell 16% on the day after reducing expected net revenues for its Sublocade drug to $8-$10M from the prior $25-50M view. Insurance reimbursements still seem to be of concern. To the upside Airbus +3.2% is pursuing a deal with China for $18B in jet sales. In the face of a threatened 25% tariff on Boeing 737 narrow-bodied jets Airbus is hoping…

CAPIS Harvest Moon Global Markets 9/26/2018

News Trading Desk International Summary

International Summary

posted by Matthew Kiselica on 09/26/2018 at 6:53 am
by Matthew Kiselica on 09/26/2018

Asian Markets The Chinese mainland markets traded well thanks to announcements by MSCI.  The company declared it was contemplating an increase to its Chinese weighting and permitting ChiNext shares for the first time.  A heavy ex-dividend day caused Japan to be mixed.  More than 1,000 shares in the TOPIX traded without their respective dividends.  Currency and crude price concerns weighed upon India.  S. Korea was closed for Harvest Moon day. Most sectors gains with energy higher by c. 1.5% fueled by crude’s recent gains.  Consumer staples were higher by 1%.  Utilities and consumer staples were down small and real estate lagged. Other Important Headlines After the local close, Japan’s GPIF (the world’s largest pension fund) stated it will permit greater “deviation” of its JGB holdings.  In essence, this means it may allocate a greater portion of assets to equities and other riskier investments. Tencent +0.5% will allow Hong Kong shoppers to make mainland purchases with its Wechat Pay.  This makes it the first company to permit mobile wallet payments for such transactions. Suzuki Motors -3.9% tumbled intra-day after announcing it found further falsified testing data. Nufarm-halted- because the company announced an A$300m entitlement offer while seeing FY underlying profits 2.1% below…

Asian Markets The Chinese mainland markets traded well thanks to announcements by MSCI.  The company declared it was contemplating an increase to its Chinese weighting and permitting ChiNext shares for the first time.  A heavy ex-dividend day caused Japan to be mixed.  More than 1,000 shares in the TOPIX traded without their respective dividends.  Currency and crude price concerns weighed upon India.  S. Korea was closed for Harvest Moon day. Most sectors gains with energy higher by c. 1.5% fueled by crude’s recent gains.  Consumer staples were higher by 1%.  Utilities and consumer staples were down small and real estate lagged. Other Important Headlines After the local close, Japan’s GPIF (the world’s largest pension fund) stated it will permit greater “deviation” of its JGB holdings.  In essence, this means it may allocate a greater portion of assets to equities and other riskier investments. Tencent +0.5% will allow Hong Kong shoppers to make mainland purchases with its Wechat Pay.  This makes it the first company to permit mobile wallet payments for such transactions. Suzuki Motors -3.9% tumbled intra-day after announcing it found further falsified testing data. Nufarm-halted- because the company announced an A$300m entitlement offer while seeing FY underlying profits 2.1% below…

CAPIS EU Close – 9/25/2018

News Trading Desk International Summary

International Summary

posted by Clayton Duff on 09/25/2018 at 1:00 pm
by Clayton Duff on 09/25/2018

European indices moved little over the session today with mostly smaller gains seen on the day. Italy led on the session, up over a percent and a half , with their government agreeing to keep their budget deficit to GDP under 2%.  On continued talk of future Iranian sanctions and a weakening Dollar oil prices continue higher.  On that Energy was the second best performer, up 1.76%.  Gains in miners pushed the Basic Resources sector up as much with Tech and Healthcare rounding out sectors closing above a percent.  Autos fell 2.24% with broad losses in the space. Sweden closed flat with PM Lofven losing a confidence vote and thus being ousted.  On this government leadership is in limbo with recent elections seeing an uptick in members calling for more law and order and greater restrictions on immigration.  On the Brexit front sentiment slipped with PM May noting before the close that the current proposal by the EU is a bad deal and no deal is preferably to a bad deal. In Milan, banks saw gains with aerospace firm Leonardo up 2.4% after it was selected by the US to produce helicopters to replace their Huey’s. Boeing will be the primary…

European indices moved little over the session today with mostly smaller gains seen on the day. Italy led on the session, up over a percent and a half , with their government agreeing to keep their budget deficit to GDP under 2%.  On continued talk of future Iranian sanctions and a weakening Dollar oil prices continue higher.  On that Energy was the second best performer, up 1.76%.  Gains in miners pushed the Basic Resources sector up as much with Tech and Healthcare rounding out sectors closing above a percent.  Autos fell 2.24% with broad losses in the space. Sweden closed flat with PM Lofven losing a confidence vote and thus being ousted.  On this government leadership is in limbo with recent elections seeing an uptick in members calling for more law and order and greater restrictions on immigration.  On the Brexit front sentiment slipped with PM May noting before the close that the current proposal by the EU is a bad deal and no deal is preferably to a bad deal. In Milan, banks saw gains with aerospace firm Leonardo up 2.4% after it was selected by the US to produce helicopters to replace their Huey’s. Boeing will be the primary…

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