Asian Market Update: RBA surprises with a 25bp cut; Spain rumored to edge toward bailout; BOK pledges more support

Forex

Article

Articles menu

Article content

Asian Market Update: RBA surprises with a 25bp cut; Spain rumored to edge toward bailout; BOK pledges more support

02.10.2012 08:18 Tuesday
***Economic Data***
- (AU) RESERVE BANK OF AUSTRALIA (RBA) CUTS CASH TARGET RATE 25BPS TO 3.25%; NOT EXPECTED
- (JP) JAPAN AUG LABOR CASH EARNINGS Y/Y: +0.2% V -1.0%E (first rise in four months)
- (JP) JAPAN SEPT MONETARY BASE Y/Y: 9.0% V 6.5% PRIOR (7-month high)
- (AU) Australia Sept RPData-Rismark House PX Actual y/y: 1.4% v 0.0% prior
- (NZ) NEW ZEALAND SEPT ANZ COMMODITY PRICE INDEX M/M: 3.5% V 0.5% PRIOR (18-month high)
- (KR) SOUTH KOREA SEPT HSBC MANUFACTURING PMI: 45.7 V 47.5 PRIOR (4th consecutive contraction)
- (KR) SOUTH KOREA SEPT CONSUMER PRICE INDEX (CPI) M/M: 0.7% V 0.5%E; Y/Y: 2.0% V 1.8%E (3-month high); CORE CONSUMER PRICE INDEX Y/Y: 1.4% V 1.3% PRIOR

***Markets Snapshot (as of 03:30GMT)***
- Nikkei225 +0.4%
- S&P/ASX +0.7%
- Kospi +0.3%
- Shanghai Composite closed
- Hang Seng closed
- Dec S&P500 +0.1% at 1,438
- Dec gold at -0.2% 1,380/oz
- Nov Crude oil -0.1% at $92.36/brl

***Notes/Observations***
- Asian equity markets are tracking gains on Wall St, where ISM manufacturing data boosted indices after printing its first expansion in 4 months. Stronger than expected US ISM was a welcome change of pace following a spate of disappointing PMIs from Europe as well as China overnight. Also helping sentiment late in the day was press report suggesting Spain has now shifted in favor of asking for a bailout but faced reluctant German leadership that prefers to bring other funding requests from other states to its parliament. The report further reminded that Spain has about €29B in maturing debt by the end of October and speculating it could still submit the request ahead of the fin min summit in Luxembourg next Monday. Spain developments boosted the single currency back above the $1.29 handle with some follow-up strength ahead of the European open.

- Reserve Bank of Australia shocked the markets with an unexpected 25bp rate cut - its first since the June meeting. RBA pointed to outlook for growth in global economy slowing over recent months, with global GDP edging lower and looking weaker. Notably, RBA also added that terms of trade were down 10% since the peak and would fall further and also projected the peak in resource investment is likely to occur next year. AUD/USD crashed over 60 pips toward the $1.03 handle - its lowest level in nearly 4 weeks. EUR/AUD approached its multi-week highs above 1.25, while AUD/NZD cross fell to its 2012 lows below 1.24.

- Also on the monetary front, Bank of Korea flagged a rate cut to come at next week's meeting, pointing to increased downside risk to growth justifying more focus on growth. Earlier, Korean press also indicated BOK is now more likely to cut rates after surprisingly holding policy steady despite the majority of analysts clamoring for a cut.

***Fixed Income/Commodities***
- (KR) South Korea sells 3-yr bonds; yield 2.80%
- S&P: Miners face pressure from low iron ore prices; avg ore price must recover to above $120/ton in the near-term
- (US) USDA crop progress report for week ended Sept 30: US corn crop across 18 select states: 24% good/excellent v 24% last week
- (JP) Japan Iron and Steel Federation: Aug exports rose 5.6% y/y to 3.67M tons (4th consecutive increase) - Nikkei News
- GLD: SPDR Gold Trust ETF daily holdings rise by 1.8 tons to 1,332.6 tons
- SLV: iShares Silver Trust ETF daily holdings rise to 9,939 tons from 9,925 tons

***Speakers/Political/In the Papers***
- (JP) S&P: Sees Japan FY12/13 real GDP at approx 2%; FY13 GDP at 1.6%; Growth in Japan to slow as reconstruction boost fades
- (JP) Japan Center for Economic Research (JCER): Govt should prepare a ¥2T supplementary budget for FY12/13 to deal with downside risks to economy - Nikkei News
- (JP) BOJ likely to keep policy unchanged at the upcoming Oct 5 meeting; could lower forecast for CPI - Japan press
- (JP) Japan Chief Cabinet Secy Fujimura: Must be cautious over any BoJ foreign bond purchases
- (JP) Japan Coast Guard (JCG) reported China surveillance ships sighted near disputed islands following an earlier report that a Taiwan's Coast Guard ship and at least one Taiwan fishing vessel was sighted in the contiguous zone.

- (KR) Bank of Korea: To adjust monetary policy to support growth; Facing increased downside risk to growth - report to Parliament
- (KR) South Korea banks rushing to cut bad debts amid recent court receivership by a mid-sized builder - Korean press
- (KR) South Korea Finance Ministry: To sell up to $1B in currency bonds in 2013 to help cushion fluctuations in the global financial market - Korean press

- (CN) RBS sees China 2012 GDP at 7.5% and 2013 GDP at 7.8%; Does not expect a major stimulus package - China Daily
- (CN) Beijing municipal government saw CNY25.7B in land sales in Sept - highest since Dec 2010 - China Daily

- (ES) Spain said to be prepared to ask for a sovereign bailout, but Germany encouraging Madrid to wait before doing so - financial press
- (US) Fed's Bernanke: Expects inflation to remain low, economy to continue expanding; Fed policy over the past five years have not led to inflation
- (UK) British Chambers of Commerce (BCC): Q3 survey showed confidence weakened in Service,
Manufacturing sector; forecasts UK Q3 GDP at 0.5%
- (EU) ECB's Asmussen: Doubt the ECB will be able to take over bank supervision by January 1st, 2013; banking union will not by itself solve the eurozone crisis

***Asia Equities***

- Samsung Electronics 005930.KR: Received US court permission to sell Galaxy Tab - financial press

- Cosmo Oil 5007.JP: In discussions with lenders; seeking to relax some loan terms - financial press
- Unicharm 8113.JP: May report H1 op profit +6% y/y to about ¥27B - Nikkei News
- Seven & I 3382.JP: May report H1 op profit +3% y/y to over ¥100B - Nikkei News
- Citizen Holdings 7762.JP: May report H1 op profit around ¥8.5B v ¥9.0B prior target; Rev seen +3% y/y to ¥140B - Nikkei News
- Mitsui OSK Lines 9104.JP: Lowers H1 group net loss to ¥13.5B from ¥2.0B prior - Nikkei press
- Mitsubishi Motors 7211.JP: To sell Netherlands factory to VDL Groep as part of ongoing European pullout - Nikkei News

***US Equities***
- CLB: Lowers Q3 $1.09-1.13 v $1.22e, $240-245M v $256Me ($1.17-1.25, R$250-260M prior guidance); -10.0% afterhours
- KRO: Reports prelim Q3 $0.26-0.29 adj v $0.39e, Rev $480-495M v $521Me; -6.8% afterhours
- WPP: Lowers 2012 EPS guidance to $0.28-0.30 v $0.39e (guided $0.39-0.41 prior); +0.1% afterhours
- PETM: To join S&P500, replacing Sunoco on close of trading on Oct 4th; +2.9% afterhours

TradeTheNews.com

es


EmediateAd










Notowania

Ads

Sonda

Reklama