International Summary

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CAPIS Global Recap – 8/17/2018

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International Summary

posted by Clayton Duff on 08/17/2018 at 6:30 am
by Clayton Duff on 08/17/2018

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…

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…

CAPIS Global Recap – 8/16/2018

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International Summary

posted by Clayton Duff on 08/16/2018 at 6:35 am
by Clayton Duff on 08/16/2018

Asian Headlines Previous day weakness bled over again into Asia today but losses were rather subdued by day’s end.  Early on Japan and Hong Kong were over 1.5% weaker with Shanghai down nearly 2%. However the initially selling quickly abated with indices finishing down small on the day. Shanghai was able to hold the 2700 level with Hong Kong holding 27000 but that is still under the 400 day.   Sentiment inched higher with word China’s Vice ComMin will meet with the US’ Treasury Undersecretary later this month.  A strengthening Turkish Lira also helped. On the economic front Chinese Foreign Direct Investment rose 14.9% on a YoY basis in July.  Japanese exports slowed in July, up only 3.9% which was light estimates and the prior reading. As expected imports grew 14.6% as they moved to a Trade Deficit of ¥231.2B in July.  After several months of growth Employment slowed in July Down Under.   Of interest yesterday headlines hit that foreign nationals will be allowed to open A-share (Renminbi-denominated) security accounts there. Real estate names held in China upon press reports expressing caution on the rise in mortgages as they added banks are seeing added risk with exposure to the sector. Post…

Asian Headlines Previous day weakness bled over again into Asia today but losses were rather subdued by day’s end.  Early on Japan and Hong Kong were over 1.5% weaker with Shanghai down nearly 2%. However the initially selling quickly abated with indices finishing down small on the day. Shanghai was able to hold the 2700 level with Hong Kong holding 27000 but that is still under the 400 day.   Sentiment inched higher with word China’s Vice ComMin will meet with the US’ Treasury Undersecretary later this month.  A strengthening Turkish Lira also helped. On the economic front Chinese Foreign Direct Investment rose 14.9% on a YoY basis in July.  Japanese exports slowed in July, up only 3.9% which was light estimates and the prior reading. As expected imports grew 14.6% as they moved to a Trade Deficit of ¥231.2B in July.  After several months of growth Employment slowed in July Down Under.   Of interest yesterday headlines hit that foreign nationals will be allowed to open A-share (Renminbi-denominated) security accounts there. Real estate names held in China upon press reports expressing caution on the rise in mortgages as they added banks are seeing added risk with exposure to the sector. Post…

CAPIS EU Close – 8/15/2018

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International Summary

posted by Clayton Duff on 08/15/2018 at 12:53 pm
by Clayton Duff on 08/15/2018

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…

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…

CAPIS Global Markets 8/15/2018

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International Summary

posted by Matthew Kiselica on 08/15/2018 at 6:44 am
by Matthew Kiselica on 08/15/2018

Asian Markets The region traded lower with China leading the way.  The markets there were already to the downside but saw increased selling pressure following a report related to video gaming.  Sources allege China is freezing all video game approvals as key departments are being restructured.  This caused bids to get hit in the tech sector and the rest were dragged lower.  Further negative for China was the Yuan reference price set at its weakest level since May of 2017.  Also, real estate curb fears were raised by a continued increase in Chinese home prices.  S. Korea and India were closed. With both China and Japan in the red, all the major sectors were lower.  Losses of 1% or more were seen among real estate, materials, IT, financials, consumer discretionary and utilities. Important Headlines Chinese new home prices rose 1.21% m/m during July vs. 1.1% previously.  The y/y increase was even more robust: 5.8% vs. 5.0% during June.  That is the fastest advance since last September. Regarding the Hong Kong property market, Wheelock -1.5% announced it will be make more selective purchases during H2.  It cited the proposed Hong Kong vacancy tax and rising interest rate environment. Indonesia has become the…

Asian Markets The region traded lower with China leading the way.  The markets there were already to the downside but saw increased selling pressure following a report related to video gaming.  Sources allege China is freezing all video game approvals as key departments are being restructured.  This caused bids to get hit in the tech sector and the rest were dragged lower.  Further negative for China was the Yuan reference price set at its weakest level since May of 2017.  Also, real estate curb fears were raised by a continued increase in Chinese home prices.  S. Korea and India were closed. With both China and Japan in the red, all the major sectors were lower.  Losses of 1% or more were seen among real estate, materials, IT, financials, consumer discretionary and utilities. Important Headlines Chinese new home prices rose 1.21% m/m during July vs. 1.1% previously.  The y/y increase was even more robust: 5.8% vs. 5.0% during June.  That is the fastest advance since last September. Regarding the Hong Kong property market, Wheelock -1.5% announced it will be make more selective purchases during H2.  It cited the proposed Hong Kong vacancy tax and rising interest rate environment. Indonesia has become the…

CAPIS EU Close – 8/14/208

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International Summary

posted by Clayton Duff on 08/14/2018 at 12:49 pm
by Clayton Duff on 08/14/2018

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.…

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.…

CAPIS Global Markets

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International Summary

posted by Matthew Kiselica on 08/14/2018 at 7:03 am
by Matthew Kiselica on 08/14/2018

Asian Markets Thanks to the gains in the States, most of the region advanced.  However, the China fell following disappointing macro data.  The July gains for Chinese industrial profits, retail sales and fixed investment were each light of consensus.  The fixed investment growth is the lowest since 1996.  It is worth noting those markets outperformed on a relative basis yesterday.  The ¥ weakened to 111 providing a additional lift to Japanese equities. The markets wobbled when an incident occurred in Parliament in the U.K.  More on this in the European section.  Most sectors ended the day higher with telcos ahead c. 1.5% and energy higher c. 1.0%.   Tech names weighed as did real estate. Important Headlines Included Hon Hai -3.0% posted OP and NI that fell short of estimates.  It appears supply constraints are hindering performance along with flattish smartphone sales.  Several brokers cut estimates in response to the results. LG Electronics -3.5% fell sharply early doors with emerging nation currency risk being cited as the cause.  The shares pared about half the loss. It was a dark day for Sunny Optical -24.1% shareholders.  The company’s H1 NI income fell short of estimates on margin declines and currency headwinds.   The…

Asian Markets Thanks to the gains in the States, most of the region advanced.  However, the China fell following disappointing macro data.  The July gains for Chinese industrial profits, retail sales and fixed investment were each light of consensus.  The fixed investment growth is the lowest since 1996.  It is worth noting those markets outperformed on a relative basis yesterday.  The ¥ weakened to 111 providing a additional lift to Japanese equities. The markets wobbled when an incident occurred in Parliament in the U.K.  More on this in the European section.  Most sectors ended the day higher with telcos ahead c. 1.5% and energy higher c. 1.0%.   Tech names weighed as did real estate. Important Headlines Included Hon Hai -3.0% posted OP and NI that fell short of estimates.  It appears supply constraints are hindering performance along with flattish smartphone sales.  Several brokers cut estimates in response to the results. LG Electronics -3.5% fell sharply early doors with emerging nation currency risk being cited as the cause.  The shares pared about half the loss. It was a dark day for Sunny Optical -24.1% shareholders.  The company’s H1 NI income fell short of estimates on margin declines and currency headwinds.   The…

CAPIS EU Close – 8/13/2018

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International Summary

posted by Clayton Duff on 08/13/2018 at 12:44 pm
by Clayton Duff on 08/13/2018

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…

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…

CAPIS Global Markets 8/13/2018

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International Summary

posted by Matthew Kiselica on 08/13/2018 at 6:25 am
by Matthew Kiselica on 08/13/2018

Friday’s risk-off sentiment continues and the markets have been a sea of red to start the week.  The Turkish Lira has seen further declines trading with a 7 handle before paring the losses.  Since breaching 5 vs. the Greenback earlier this month, the currency has declined by c. 30.0% at its lows.  Today, Turkey’s central bank has taken measures to support the battered currency.  It has eased collateral rules and raised the borrowing of lira banks are permitted vs. FX reserves to €20b.  That is c. 3x the prior limit.  Additionally, it permitted lower holdings vs. bank  liabilities to provided greater liquidity. The Lira wasn’t the only currency under attack today.  The Rand has seen further pressure weakening to 15.5517 before regaining some of the lost ground.  In addition to the pressure the Lira’s woes have created for most developing nation currencies, uncertainties regarding S. African land and mining policies have added to the Rand’s decline. Asian Markets The Asian markets fell with the vast majority of the indices firmly to the downside.  China outperformed and the Shenzhen Composite manged to end the day in the green.  Sectors were lower across the board with losses of 1% or more seen…

Friday’s risk-off sentiment continues and the markets have been a sea of red to start the week.  The Turkish Lira has seen further declines trading with a 7 handle before paring the losses.  Since breaching 5 vs. the Greenback earlier this month, the currency has declined by c. 30.0% at its lows.  Today, Turkey’s central bank has taken measures to support the battered currency.  It has eased collateral rules and raised the borrowing of lira banks are permitted vs. FX reserves to €20b.  That is c. 3x the prior limit.  Additionally, it permitted lower holdings vs. bank  liabilities to provided greater liquidity. The Lira wasn’t the only currency under attack today.  The Rand has seen further pressure weakening to 15.5517 before regaining some of the lost ground.  In addition to the pressure the Lira’s woes have created for most developing nation currencies, uncertainties regarding S. African land and mining policies have added to the Rand’s decline. Asian Markets The Asian markets fell with the vast majority of the indices firmly to the downside.  China outperformed and the Shenzhen Composite manged to end the day in the green.  Sectors were lower across the board with losses of 1% or more seen…

CAPIS EU Close – 8/10/2018

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International Summary

posted by Clayton Duff on 08/13/2018 at 2:56 am
by Clayton Duff on 08/13/2018

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…

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…

TGIF Global Markets 8/10/2018

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International Summary

posted by Matthew Kiselica on 08/10/2018 at 6:50 am
by Matthew Kiselica on 08/10/2018

It is a “top down” day as the global markets react to Turkish worries.  The FT reported the ECB is concerned regarding financial exposure to the nation.  Specifically, BBVA -4.2%, Unicredit -3.3%, and BNP -3.4% were specifically cited in the article.  This has been sparked by the current angst between the U.S. and Turkey along with doubts regarding the nation’s economic policies.  The Turkish Lira has plummeted more than 15% today before paring the loss.  (See three day chart below.)   This has created spillover and most emerging currencies are also weaker.  The “majors” have also suffered with the € and £ notably lower.  The USD and ¥ are rallying. Turkish President Erdogan has called upon his nation to remain calm.  He stated, “they have got their dollars, we have got out people, our right, our Allah.”  His son-in-law and Finance Minister Albayrak presented his blue print for economic policy today.  On a related them, Russia has also criticized the U.S. declaring sanctions will lead to an economic war.  Stay tuned…. Turkish Lira 3 Day Chart Asian Markets Recap With a few exceptions, the major indices were lower with Japan hit the hardest on the stronger ¥.  Adding to the currencies…

It is a “top down” day as the global markets react to Turkish worries.  The FT reported the ECB is concerned regarding financial exposure to the nation.  Specifically, BBVA -4.2%, Unicredit -3.3%, and BNP -3.4% were specifically cited in the article.  This has been sparked by the current angst between the U.S. and Turkey along with doubts regarding the nation’s economic policies.  The Turkish Lira has plummeted more than 15% today before paring the loss.  (See three day chart below.)   This has created spillover and most emerging currencies are also weaker.  The “majors” have also suffered with the € and £ notably lower.  The USD and ¥ are rallying. Turkish President Erdogan has called upon his nation to remain calm.  He stated, “they have got their dollars, we have got out people, our right, our Allah.”  His son-in-law and Finance Minister Albayrak presented his blue print for economic policy today.  On a related them, Russia has also criticized the U.S. declaring sanctions will lead to an economic war.  Stay tuned…. Turkish Lira 3 Day Chart Asian Markets Recap With a few exceptions, the major indices were lower with Japan hit the hardest on the stronger ¥.  Adding to the currencies…

CAPIS Global Markets 8/09/2018

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International Summary

posted by Matthew Kiselica on 08/09/2018 at 6:47 am
by Matthew Kiselica on 08/09/2018

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 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…

CAPIS Global Recap – 8/8/2018

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International Summary

posted by Clayton Duff on 08/08/2018 at 6:47 am
by Clayton Duff on 08/08/2018

Asian Headlines Asian markets ended mixed today with mainland China giving back a good bit of yesterday’s gains.  Apart from Energy all sectors fell on the Shanghai, led by Consumer Discretionary names.  Elsewhere moves were limited with small gains seen in Hong Kong, South Korea, and Australia.   On the tariff front $16B of goods from China is expected to be assessed on starting August 23rd.  Related, Chinese exports grew 12.2% in July, ahead of the 10.0% growth expected and stronger than the prior 11.2% revised reading.  Imports rallied 27.3%, well ahead of the 16.5% growth rate expected.  On that the Trade surplus fell to $28.05B from the prior $41.46B reading. The Shanghai will institute a call auction similar to the one used in Hong Kong and on the Shenzhen starting August 20th.  Over the final 3 minutes of trading orders will not be allowed to be retracted and will determine the closing price. China’s NDRC is pushing for debt to equity swaps and will use targeted RRR cuts to support the move. China Tower IPO’d today, closing flat on the day.  $6.9B was raised in the deal for the company which operates 1.9M cell phone towers across the country. Nippon…

Asian Headlines Asian markets ended mixed today with mainland China giving back a good bit of yesterday’s gains.  Apart from Energy all sectors fell on the Shanghai, led by Consumer Discretionary names.  Elsewhere moves were limited with small gains seen in Hong Kong, South Korea, and Australia.   On the tariff front $16B of goods from China is expected to be assessed on starting August 23rd.  Related, Chinese exports grew 12.2% in July, ahead of the 10.0% growth expected and stronger than the prior 11.2% revised reading.  Imports rallied 27.3%, well ahead of the 16.5% growth rate expected.  On that the Trade surplus fell to $28.05B from the prior $41.46B reading. The Shanghai will institute a call auction similar to the one used in Hong Kong and on the Shenzhen starting August 20th.  Over the final 3 minutes of trading orders will not be allowed to be retracted and will determine the closing price. China’s NDRC is pushing for debt to equity swaps and will use targeted RRR cuts to support the move. China Tower IPO’d today, closing flat on the day.  $6.9B was raised in the deal for the company which operates 1.9M cell phone towers across the country. Nippon…

CAPIS Global Recap – 8/7/2018

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International Summary

posted by Clayton Duff on 08/07/2018 at 7:14 am
by Clayton Duff on 08/07/2018

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 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…

CAPIS International Summary – 8/6/2018

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International Summary

posted by Clayton Duff on 08/06/2018 at 6:26 am
by Clayton Duff on 08/06/2018

Asian Headlines In the face of ever-growing trade war specter Asia closed mixed today with mainland China a notable loser.  This is after the China hit back with retaliatory tariffs on Friday with approximately $60B of goods in focus. .  The Shanghai fell 1.29% on weakness in RE, IT, and Material names while Consumer Staples and Health Care helped push the Shenzhen down over 2%.   The Yuan strengthened today after retreating from the 6.90 level vs the Dollar on Friday. Today the Economic Observer noted a former FX official said the 7.0 handle may be the line in sand for the PBoC. The Nikkei ended flat with Telco gains balancing out losses in Material and Financials. Hong Kong rose on Industrials with Health Care and Autos lower.  RE held in despite word mortgage rates could be upped for the 1st time in 12 years.  IT names slipped Down Under with Materials better with aluminum names leading.  One firm noted China’s threatened 25% LNG tariff on US exports could be a boon to Australia’s LNG exporters. Subaru fell a percent after 1Q readings missed by a fair amount after higher aluminum prices weighed along with 12% lower global vehicle sales. They…

Asian Headlines In the face of ever-growing trade war specter Asia closed mixed today with mainland China a notable loser.  This is after the China hit back with retaliatory tariffs on Friday with approximately $60B of goods in focus. .  The Shanghai fell 1.29% on weakness in RE, IT, and Material names while Consumer Staples and Health Care helped push the Shenzhen down over 2%.   The Yuan strengthened today after retreating from the 6.90 level vs the Dollar on Friday. Today the Economic Observer noted a former FX official said the 7.0 handle may be the line in sand for the PBoC. The Nikkei ended flat with Telco gains balancing out losses in Material and Financials. Hong Kong rose on Industrials with Health Care and Autos lower.  RE held in despite word mortgage rates could be upped for the 1st time in 12 years.  IT names slipped Down Under with Materials better with aluminum names leading.  One firm noted China’s threatened 25% LNG tariff on US exports could be a boon to Australia’s LNG exporters. Subaru fell a percent after 1Q readings missed by a fair amount after higher aluminum prices weighed along with 12% lower global vehicle sales. They…

CAPIS TGIF Global Markets 8/3/2018

News Trading Desk International Summary

International Summary

posted by Matthew Kiselica on 08/03/2018 at 8:26 am
by Matthew Kiselica on 08/03/2018

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 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…

CAPIS Global Markets 8/02/2018

News Trading Desk International Summary

International Summary

posted by Matthew Kiselica on 08/02/2018 at 7:01 am
by Matthew Kiselica on 08/02/2018

Asian Markets It was a “top down” day as trade worries created a sea of red across the region.  U.S. Trade Rep. Lighthizer confirmed yesterday’s report of a 25.0% tariff vs. the previously announced 10.0%.  He also outlined products and timing on the matter.  The markets also traded lower at yesterday’s Fed comments noting the strong U.S. economy pressured local currencies especially on the periphery.  An exception was the which dipped below 112 as investors sought safe havens. As a result, the core markets were lower in a range of 1 to 2% and come of the indices gave ground a touch more.  All the major sectors were red.  Real estate, consumer discretionary and IT gave ground by c. 2%. Other Headlines included In a surprise operation, the BoJ purchased 5 to 10 yr. JGBs to halt a rise in the 10 yr. yield which reached an 18 month high.  Just Tuesday, the central bank signaled a modest change letting the yield fluctuate as to as much as 0.2% from its 0 target. Some of the Japanese earnings that were out after yesterday’s close included: Japan Tobacco +0.6%, KDDI -2.8%, and NSK -0.2%.   DBS %-1.6 posted a 20.0% gain in…

Asian Markets It was a “top down” day as trade worries created a sea of red across the region.  U.S. Trade Rep. Lighthizer confirmed yesterday’s report of a 25.0% tariff vs. the previously announced 10.0%.  He also outlined products and timing on the matter.  The markets also traded lower at yesterday’s Fed comments noting the strong U.S. economy pressured local currencies especially on the periphery.  An exception was the which dipped below 112 as investors sought safe havens. As a result, the core markets were lower in a range of 1 to 2% and come of the indices gave ground a touch more.  All the major sectors were red.  Real estate, consumer discretionary and IT gave ground by c. 2%. Other Headlines included In a surprise operation, the BoJ purchased 5 to 10 yr. JGBs to halt a rise in the 10 yr. yield which reached an 18 month high.  Just Tuesday, the central bank signaled a modest change letting the yield fluctuate as to as much as 0.2% from its 0 target. Some of the Japanese earnings that were out after yesterday’s close included: Japan Tobacco +0.6%, KDDI -2.8%, and NSK -0.2%.   DBS %-1.6 posted a 20.0% gain in…

CAPIS Global Markets 8/01/2018

News Trading Desk International Summary

International Summary

posted by Matthew Kiselica on 08/01/2018 at 7:01 am
by Matthew Kiselica on 08/01/2018

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…

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…

CAPIS Global Markets 7/31/2018

News Trading Desk International Summary

International Summary

posted by Matthew Kiselica on 07/31/2018 at 6:54 am
by Matthew Kiselica on 07/31/2018

Asian Markets There were two major macro events that held investor’s attention today.   The BoJ concluded its policy meeting with no changes to its main stimulus components.  (Full outline below)  However, Gov. Kuroda stated the JGB 10 yr. yield will be permitted to deviate as much as 0.2% from 0.  That is only a minor adjustment from the current 0.1% range.   The debt markets had been speculating more radical policy shifts.  That speculation had driven global bond yields higher, especially JBGs.   Following the BoJ statements, yields are retreating & the the 10 yr. JGB is yield is lower c. 4 basis points.  The central bank also lowered its inflation forecasts.  The ¥ wobbled but is now giving ground. The second major macroeconomic news was the official Chinese July PMI results.  Both the Manufacturing and Non-Manufacturing readings fell short of estimates.  The non-manufacturing level was the lowest result since August of 2017.  Including the Composite gauge, all three declined m/m. The equity markets traded mixed with the major indices seeing modest changes.   Indonesia was an exception falling well over 1% due to local earnings disappointments.  Overall, the region saw IT and industrials lower by roughly 1%.  Energy gained more than 0.5%. …

Asian Markets There were two major macro events that held investor’s attention today.   The BoJ concluded its policy meeting with no changes to its main stimulus components.  (Full outline below)  However, Gov. Kuroda stated the JGB 10 yr. yield will be permitted to deviate as much as 0.2% from 0.  That is only a minor adjustment from the current 0.1% range.   The debt markets had been speculating more radical policy shifts.  That speculation had driven global bond yields higher, especially JBGs.   Following the BoJ statements, yields are retreating & the the 10 yr. JGB is yield is lower c. 4 basis points.  The central bank also lowered its inflation forecasts.  The ¥ wobbled but is now giving ground. The second major macroeconomic news was the official Chinese July PMI results.  Both the Manufacturing and Non-Manufacturing readings fell short of estimates.  The non-manufacturing level was the lowest result since August of 2017.  Including the Composite gauge, all three declined m/m. The equity markets traded mixed with the major indices seeing modest changes.   Indonesia was an exception falling well over 1% due to local earnings disappointments.  Overall, the region saw IT and industrials lower by roughly 1%.  Energy gained more than 0.5%. …

What the markets will see tonight!

News Trading Desk International Summary

International Summary

posted by Matthew Kiselica on 07/30/2018 at 11:22 am
by Matthew Kiselica on 07/30/2018

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…

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…

CAPIS Global Markets 7/30/2018

News Trading Desk International Summary

International Summary

posted by Matthew Kiselica on 07/30/2018 at 6:49 am
by Matthew Kiselica on 07/30/2018

Asian Markets Following the U.S. declines from Friday, all of the core markets traded lower.   On top of the poor performance of the U.S., investors were cautious ahead of a week filled with central bank meetings.  The BoJ concludes its two day meeting tomorrow the Fed, BoE and RBI among others later in the week.  Speaking of the RBI,  India continues to outperform.  It record a record high for the 5th consecutive session .  Thailand was closed in observance of King Maha Vajiralongkorn’s birthday. With the core markets weaker, the majority of sectors closed in the red.  Health care and consumer staples fell by more than 1% with IT and real estate approached those losses.  Utilities and financials provided support with modest gains. Top Headlines Included China Life -0.75% was fined by the PBoC for failing to “preserve client IDs.”  This offset an upbeat H1 NI outlook of +25.0% to +35.0%. Komatsu’s -2.7% strong Q1 results were not enough to alleviate slowdown concerns for the company.  It noted the outlook in China was “increasingly unclear” vehicle operating times are waning. Ricoh’s +8.8% sales and OP beat and a below the mark NI was chalked up to a one which had…

Asian Markets Following the U.S. declines from Friday, all of the core markets traded lower.   On top of the poor performance of the U.S., investors were cautious ahead of a week filled with central bank meetings.  The BoJ concludes its two day meeting tomorrow the Fed, BoE and RBI among others later in the week.  Speaking of the RBI,  India continues to outperform.  It record a record high for the 5th consecutive session .  Thailand was closed in observance of King Maha Vajiralongkorn’s birthday. With the core markets weaker, the majority of sectors closed in the red.  Health care and consumer staples fell by more than 1% with IT and real estate approached those losses.  Utilities and financials provided support with modest gains. Top Headlines Included China Life -0.75% was fined by the PBoC for failing to “preserve client IDs.”  This offset an upbeat H1 NI outlook of +25.0% to +35.0%. Komatsu’s -2.7% strong Q1 results were not enough to alleviate slowdown concerns for the company.  It noted the outlook in China was “increasingly unclear” vehicle operating times are waning. Ricoh’s +8.8% sales and OP beat and a below the mark NI was chalked up to a one which had…

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