Tuesday Morning Coffee - Markets Update
Market Update: Rare delay in the 2-year JGB Action Result Announcement; cites “Trouble in the procedure”; Upcoming AU data in focus
Mon, 28 Feb 2023 0:30 AM EST / 06:30 AM CET
Today's important data release:
1st of March:
The equity markets showed a positive trend, with slight to modest gains seen in most regions, except for Chinese markets. Meanwhile, a rare delay in the 2-year JGB action result announcement citing "trouble in the procedure" occurred. Month-end flows remained in focus, and various Australian firms traded ex-dividend, including Amcor, Bega Cheese, Bendigo, Domino's Pizza Enterprises, Evolution Mining, Origin Energy, and Worley.
Some critical economic data from Australia and New Zealand were released. Australia sold A$100 million in 0.75% Nov 2027 indexed bonds, while January retail sales surged to 1.9% from 1.5% YoY. In contrast, New Zealand's Feb Business Confidence recorded a decline of -43.3 compared to -52.0 prior. The Bank of Japan (BOJ) also conducted 2.9T JPY in a 0.005% 2-year JGB bond sale, with an average yield of -0.0270%.
Moreover, the BOJ announced that it might release its monthly bond-buying schedule. Additionally, the country's January retail sales and preliminary industrial production both rose, but the latter's YoY record experienced its most significant decline in eight months. Meanwhile, South Korea sold 20-year bonds with an average yield of 3.605%, higher than 3.260% prior.
In terms of foreign policy, Politico reported that the US President Joe Biden was considering a limited Executive Order on US-China investments, scaling back previous plans for wider restrictions on American investment in China.
Overall, investors are focusing on the upcoming economic data from Australia, including the monthly CPI data due on Wed and quarterly GDP. The markets are expected to remain active throughout the week, with investors keeping an eye on any unexpected events or announcements.
General Trend:
- Equity markets trade higher paring back losses from the day before
- Slight to modest equity gains seen in Asia after Wall St rose
- Chinese markets lag
- Month-end flows in focus
- Harvey Norman declines on weak sales outlook
- Various Australian firms are trading ex-dividend (Amcor, Bega Cheese, Bendigo, Domino’s Pizza Enterprises, Evolution Mining, Origin Energy, Worley)
- BOJ might release monthly bond buying schedule
- Australia monthly CPI data due on Wed, quarterly GDP to also be released
***Headlines/Economic Data***
Australia/New Zealand
- ASX 200 opens +0.2% at 7,240
- (AU) Australia sells A$100M v A$100M indicated in 0.75% Nov 2027 indexed bonds; Avg Yield: 0.9175%; bid-to-cover: 5.85x
- (AU) Jan Retail Sales M/M: 1.9% v 1.5%e-
- (AU) Treasurer Chalmers: To apply 30% tax rate to pension balances >A$3.0M, effective from 2025-26
- (AU) Q4 Current Account (A$): 14.1B v 5.5Be
- (AU) Jan Private Sector Credit M/M: 0.4% v 0.3%e; Y/Y: 8.0% v 8.3% prior
- (AU) Australia cotton exports to China said to resume - financial press
- (NZ) New Zealand Feb Business Confidence:-43.3 v -52.0 prior
China/Hong Kong
- Hang Seng opens +0.4% at 20,020
- Shanghai Composite opens +0.2 at 3,265
- (HK) Jan Trade Balance (HKD): -25.4B v -17.0Be
- (HK) Jan CPI Composite Y/Y: 2.4% v 2.1%e
- (CN) PBOC Open Market Operation (OMO): Sells CNY481B v CNY336B prior in 7-day reverse repos: Net injects CNY331B v injects CNY66B prior
领英推荐
- (CN) PBOC sets Yuan reference rate: 6.9519 v 6.9572 prior
- (CN) China Stats Bureau (NBS): 2022 per capita income: CNY36.9K, +5.0% y/y
- (CN) PBOC to auction CNY5.0B in Central Bank Bill Swaps on Feb 28th
- (CN) Feb New Yuan Loans might decline to CNY1.6T [vs CNY4.9T in Jan (record high)] - Chinese press
Japan
- Nikkei 225 opens +0.3% at 27,515
- (JP) Japan sells ￥2.9T v ￥2.9T indicated in 0.005% 2-year JGB bonds; Avg Yield: -0.0270% v -0.0090% prior; bid-to-cover: 4.11x v 3.73x prior
- (JP) Bank of Japan (BOJ) again offers 5-year loans to banks (as expected): offers ￥1.0T in loans; total bids ￥3.0T
- JAN RETAIL SALES M/M: 1.9% V 0.4%E; Y/Y: 6.3% V 4.0%E
- JAN PRELIMINARY INDUSTRIAL PRODUCTION M/M: -4.6% V -2.9%E [largest m/m decline in 8 months]; Y/Y: -2.3% V -0.7%E
- BOJ Deputy Govenor Nominees Uchida & Himino speak in Diet: Reiterate need to continue monetary easing
- Bank of Japan (BOJ) Dep Gov Wakatabe: Inflation target has not been achieved
- Bank of Japan (BOJ) offers to buy 5-10 year JGBs at fixed rate of 50bps; Opens window to buy unlimited amount of 10-year JGBs at 0.50% [as expected]
- Bank of Japan (BOJ) again offers 5-year loans to banks (as expected): offers ￥1.0T in loans
Korea
- (KR) Kospi opens +0.6% at 2,417
- South Korea sells 20-year bonds; Avg Yield: 3.605% v 3.260% prior
Other Asia
-(SI) Jan M2 Money Supply Y/Y: 1.8% v 1.9% prior; M1 Money Supply Y/Y: -12.8% v -10.7% prior
North America
-Reportedly Pres Biden mulling a limited Executive Order on US/China investments, scaling back previously plans for wider restrictions on American investment in China - Politico
Europe
-UK AND EU CONFIRM AGREEMENT ON FINAL TERMS OF NORTHERN IRELAND PROTOCOL DEAL. Confirms deal delivers green lane and red lane trade routes, goods staying in UK will use a new green lane with separate red lane for goods moving to the EU
Levels as of 00:20 ET / 06:30 AM CET
- Nikkei 225, flat, ASX 200 +0.5% , Hang Seng -0.2%; Shanghai Composite -0.2% ; Kospi +0.5%
- Equity S&P500 Futures: flat; Nasdaq100 +0.1%, Dax -0.2%; FTSE100 -0.1%
- EUR 1.0615-1.0585 ; JPY 136.35-136.11 ; AUD 0.6750-0.6722 ;NZD 0.6172-0.6148
- Gold -0.3% at $1,820/oz; Crude Oil +0.3% at $75.94/brl; Copper -0.3% at $4.0030/lb
General news Information is provided by TradeTheNews.com
The article and the data is for general information use only, not advice!
The Trade Academy Team