Chinese regulatory headwinds weigh on market sentiment
Asian Market Update: Chinese regulatory headwinds weigh on market sentiment as Australia returns to the green with no word on Evergrande bond payment due, watch out for China’s official PMI on Friday.
– Markets have traded lower as China continues to put in place new regulatory measures, its first white paper on exports released today. Australia were the only ones to post a positive performance with their first day of trading after the Christmas break.
– The yen has traded within a narrow range with large options expiring today, analysts note it is unlikely to cross 115 before the new year. With little major news, currencies changed little.
– COVID cases continue to rage in South Korea and Australia, as manufacturers in Xi’an, China develop alternative plans while COVID cases are processed.
– China uses another big OMO operation, lowering the overnight repurchase rate by 29 bps.
– The Japanese press focuses on autonomous driving technology in automobiles.
– Musk sells another $ 1.02 billion in Tesla shares.
– Chinese affairs office in Taiwan takes a firm stance on relations in 2022.
– With a 30-day grace period, Evergrande has not commented on whether he has made or planned to pay the deposit payment that was due on December 28.
Titles / Economic data
Australia / New Zealand
– ASX 200 open flat.
– SYR.AU gives further update on Tesla deal: contract is expected to reach agreement on AAM specifications by the end of 2022.
– (AU) Australia PM Morrison: The national cabinet meeting on COVID will take place on Thursday, December 30.
– (AU) China sets the import tariff quota for Australian wool for 2022 at 40.2 kt.
– The Nikkei 225 opened -0.3%.
– (JP) Japanese automakers plan to equip their produced cars with autonomous driving functions as early as 2022 – Nikkei.
– (JP) Japan to maintain border rules against the spread of Omicron variant for now – press.
– 3086.JP Reports 9M Net + ¥ 3.7B v – ¥ 15.6B y / y; Op +4.4 billion against -18.5 billion y / y; Rev 237.5B vs. ¥ 230.7B y / y (shares + 10%).
– Kospi opened -0.6%.
– (KR) South Korea Manufacturing Enterprise Survey January: 92 v 88 previously; Non-manufacturing survey: 78 against 83 previously.
– (KR) South Korea Terms of trade in November: 88.3, -10.1% year-on-year (9-year low).
– (KR) The ruling Party in South Korea and the government have agreed on the need to expand measures against coronaviruses.
– 005930.KR Have flexibility in chip production lines at factories in Xi’an, China (a city currently experiencing a COVID epidemic).
– (KR) South Korea Foreign Affairs Min Chung: South Korea and the United States “actually agreed” on a project to end the Korean War – Yonhap.
China / Hong Kong
– Hang Seng opened -0.1%; Shanghai Composite opened flat.
– (CN) The Chinese PBOC fixes the benchmark rate of the yuan: 6.3735 against 6.3728 previously.
– (CN) China PBOC Open Market Operation (OMO): sells CNY 200 billion in 7-day reverse repurchase agreements against CNY 200 billion previously; Net injection: CNY190B vs. CNY190B before.
– (CN) China Q4 Beige Book shows that companies have cut back on investment and have remained cautious about borrowing.
– (CN) China PBOC will lead CNY5.0B in a 3-month Central Bank Note (CBS) swap operation in today’s session against CNY5.0B forward.
– (TW) China Taiwan Affairs Office Official Ma: Will be more energetic against Taiwan independence; Ask about the report that Chinese spies have infiltrated the Taiwanese military.
– (CN) China Releases White Paper on Export Control – Chinese State Media.
– (CN) Expects China to set the TC / RC floor for copper in the first quarter at $ 70 / t and $ 0.07 / lb, flat q / q – Press.
– (CN) Shanghai Sec News: China is considering adding participants and derivatives to the domestic carbon emissions trading market.
– (CN) China State Planner (NDRC) approved the construction of data center clusters in Inner Mongolia, Gansu, Guizhou and Ningxia provinces.
– 1810.HK to announce CNY 100 billion 5-year R&D plan to become number 1 mobile phone brand within 3 years – HK Press.
– JD Closes $ 2.0 Billion 5 Year Green Loan Facility; Increases share buyback amount from $ 1.0 billion to $ 3.0 billion and extends term to March 2024.
– 3333.HK have ~ $ 7.4 billion in bond coupon payments and redemptions due during 2022 (the reminder had 2 USD bond payments due on December 28, has a grace period of 30 days before a defect can be declared).
– (TW) China Official Ma: Will be more energetic against Taiwan independence.
– (SL) Sri Lanka Central Bank Gov Cabraal: official reserve position at 3.1 billion dollars, with reserves to remain around the current level until the end of the year.
– (United States) Weekly API crude oil inventories: -3.1 M against -3.7 M previously.
– TSLA CEO Musk files Form 4 to exercise approximately 1.56 million options at $ 6.24 / shr; Sells ~ $ 1.0 billion in stocks.
– (IE) Ireland Dec economic pulse: 79.9 against 83.2 before.
– (UK) Russia Dep PM Novak: Russia is ready to export more gas to the EU if long term supply contracts are signed, has sufficient resources to meet any EU demand; The oil price of $ 65-80 / barrel is comfortable in 2022.
– GAZP.RU Has not reserved gas transit capacity for export via the Yamal-Europe pipeline for December 29 (9th consecutive day).
Levels from 00:15 ET
– Hang Seng -0.9%; Shanghai Composite -0.7%; Kospi -0.8%; Nikkei225 -0.8%; ASX 200 + 1.2%.
– Equity Futures: S & P500 + 0.1%; Nasdaq100 + 0.3%, Dax -0.0%; FTSE100 + 0.3%.
– 1.1315-1.1298 euros; 114.88-114.74 JPY; AUD 0.7236-0.7213; NZD 0.6813-0.6791.
– Commodity Futures: Gold -0.3% at $ 1,806 / oz; Crude oil + 0.1% at $ 76.02 / brl; Copper -0.7% at $ 4.41 / lb.