Valentine’s Day Global Markets 2/14/2019
Asian Markets The region’s markets were mixed with most indices posting modest moves in either direction. Investors showed little response to the earlier report the U.S. trade tariff deadline may be extended by 60 days. The exception is the KOSPI which advanced more than 1%. The bulk of the day’s advance was buying on the…
Asian Markets
The region’s markets were mixed with most indices posting modest moves in either direction. Investors showed little response to the earlier report the U.S. trade tariff deadline may be extended by 60 days. The exception is the KOSPI which advanced more than 1%. The bulk of the day’s advance was buying on the close due to expiry.
In keeping with the markets, sectors were mixed. Consumer staples and healthcare gained less than 0.5% while telcos gave ground by about that market.
China’s January trade balance was stronger than expected. In USD terms, exports rose 9.1% y/y vs. a decline of 3.3% expected. Imports dipped 1.5% but that is well ahead of the 10.2% slide anticipated. This results in a trade surplus of $39.2b. Japan’s Q4 GDP rose 1.4% which is inline.
Other Important Headlines
- Telstra -2.2% cut its dividend and is seeing margin erosion as rollout of NBN data sharing increases costs and competition.
- Newcrest Mining’s -1.4% H1 earnings are better by 104%. However, the cost per ounce is higher by 11% during the period.
- MGM China’s +0.9% Q4 adj. property Ebitda rose 11% to $167m, topping estimates.
- Sunny Optical -5.0% issued a profit warning for FY ’18. Both Credit Suisse and Jefferies cut ratings blaming margin concerns.
- Woodside Petrol’s +1.9% 2018 profits are better by 28% and the company will raise its final dividend by 86% to 91 cents.
- While underlying profits at AMP -7.8% are ahead of expectations for last year. However, the company is suffering heavy outflows due to misconduct investigations.
European Markets
The region has spent the entire session to the upside on a heavy earnings day. Italy has lagged the rest of the markets as its 10 yr. yield vs. the corresponding German bund is widening. Sectors are split. Food/beverages, industrials, technology and chemicals are better by at least 1%. Limiting gains are financials lower c.0.5% followed by banks, retail and basic resources.
Macro from the region shows Germany’s Q4 preliminary GDP a touch light and flat which puts it close to falling into recession. The EC’s result was bang inline.
Keep you eyes open for Brexit headlines at Parliament debates the matter today. (This sounds very familiar for some reason.)
Snippets from the Region
- Following a cut to Emirates A380 Superjumbo orders, Airbus +4.0% has decided to cut the program!
- Nestle’s +3.0% FY organic sales of 3% match estimates. The company sees organic sales improving this year AND is making positive Chinese growth comments. It is exploring options for its Herta unit including a potential sale.
- Credit Suisse -1.7% saw inflows at its asset management arm and the investment bank improved overall. However, trading losses are worse than expected and CEO Thiam notes caution for FY ’19.
- AstraZeneca’s +5.4% results are just want the doctor ordered. Q4 EPS are better than expected and the company sees sales and EPS improving this year.
Plenty more out there today!
On Our Side of the Pond
- The House of Representatives will vote on the tentative spending/border bill this evening.
- Keep an eye on Boeing following the Airbus news.
- Earnings out or still due include Cisco, AIG, Bombardier, Banco de Brasil, Brookfield and Coca-Cola.
Markets and Macro
| Event | Survey | Actual | Prior | Revised | ||
| JN | GDP SA QoQ | 4Q P | 0.40% | 0.30% | -0.60% | -0.70% |
| JN | GDP Annualized SA QoQ | 4Q P | 1.40% | 1.40% | -2.50% | -2.60% |
| JN | GDP Nominal SA QoQ | 4Q P | 0.40% | 0.30% | -0.70% | -0.60% |
| JN | GDP Deflator YoY | 4Q P | -0.40% | -0.30% | -0.30% | -0.40% |
| JN | GDP Private Consumption QoQ | 4Q P | 0.70% | 0.60% | -0.20% | — |
| JN | GDP Business Spending QoQ | 4Q P | 1.80% | 2.40% | -2.80% | -2.70% |
| AU | Consumer Inflation Expectation | Feb | — | 3.70% | 3.50% | — |
| UK | RICS House Price Balance | Jan | -20% | -22% | -19% | — |
| SK | Money Supply L SA MoM | Dec | — | 0.50% | 0.20% | — |
| SK | Money Supply M2 SA MoM | Dec | — | 0.30% | 0.50% | — |
| CH | Trade Balance CNY | Jan | 245.00b | 271.16b | 394.99b | — |
| CH | Exports YoY CNY | Jan | 3.80% | 13.90% | 0.20% | — |
| CH | Imports YoY CNY | Jan | -1.90% | 2.90% | -3.10% | — |
| CH | Trade Balance | Jan | $34.30b | $39.16b | $57.06b | — |
| CH | Exports YoY | Jan | -3.30% | 9.10% | -4.40% | — |
| CH | Imports YoY | Jan | -10.20% | -1.50% | -7.60% | — |
| SK | Bloomberg Feb. South Korea Economic Survey (Table) | |||||
| FR | ILO Unemployment Rate | 4Q | 9.10% | 8.80% | 9.10% | — |
| FR | Mainland Unemp. Change 000s | 4Q | — | -90k | 22k | 18k |
| FR | ILO Mainland Unemployment Rate | 4Q | 8.80% | 8.50% | 8.80% | — |
| IN | Wholesale Prices YoY | Jan | 3.70% | 2.76% | 3.80% | — |
| GE | Wholesale Price Index YoY | Jan | — | 1.10% | 2.50% | — |
| GE | Wholesale Price Index MoM | Jan | — | -0.70% | -1.20% | — |
| GE | GDP SA QoQ | 4Q P | 0.10% | 0.00% | -0.20% | — |
| GE | GDP NSA YoY | 4Q P | 0.80% | 0.90% | 1.10% | — |
| GE | GDP WDA YoY | 4Q P | 0.70% | 0.60% | 1.10% | — |
| CH | Foreign Direct Investment YoY CNY | Jan | — | 4.80% | 24.90% | — |
| EC | Employment QoQ | 4Q P | — | 0.30% | 0.20% | 0.20% |
| EC | Employment YoY | 4Q P | — | 1.20% | 1.30% | 1.30% |
| EC | GDP SA QoQ | 4Q P | 0.20% | 0.20% | 0.20% | — |
| EC | GDP SA YoY | 4Q P | 1.20% | 1.20% | 1.20% | — |
| CA | Manufacturing Sales MoM | Dec | 0.40% | — | -1.40% | — |
| US | PPI Final Demand MoM | Jan | 0.10% | — | -0.20% | -0.10% |
| CA | New Housing Price Index MoM | Dec | 0.00% | — | 0.00% | — |
| US | PPI Ex Food and Energy MoM | Jan | 0.20% | — | -0.10% | 0.00% |
| CA | New Housing Price Index YoY | Dec | 0.00% | — | 0.00% | — |
| US | PPI Ex Food, Energy, Trade MoM | Jan | 0.20% | — | 0.00% | — |
| US | PPI Final Demand YoY | Jan | 2.10% | — | 2.50% | — |
| US | PPI Ex Food and Energy YoY | Jan | 2.50% | — | 2.70% | — |
| US | PPI Ex Food, Energy, Trade YoY | Jan | 2.70% | — | 2.80% | — |
| US | Initial Jobless Claims | 9-Feb | 225k | — | 234k | — |
| US | Continuing Claims | 2-Feb | 1740k | — | 1736k | — |
| US | Retail Sales Advance MoM | Dec | 0.10% | — | 0.20% | — |
| US | Retail Sales Ex Auto MoM | Dec | 0.00% | — | 0.20% | — |
| US | Retail Sales Ex Auto and Gas | Dec | 0.40% | — | 0.50% | — |
| US | Retail Sales Control Group | Dec | 0.40% | — | 0.90% | — |
| US | Bloomberg Consumer Comfort | 10-Feb | — | — | 58.2 | — |
| US | Business Inventories | Nov | 0.20% | — | 0.60% | — |