Economic Data
(AU) AUSTRALIA NOV TRADE BALANCE (A$): 1.38B V 1.7Be (9-month low)
(CN) CHINA DEC HSBC SERVICES PMI: 52.5 V 52.5 PRIOR
(HK) HONG KONG DEC PMI: 49.7 V 48.7 PRIOR
(PH) PHILIPPINES DEC CPI M/M: -0.2% V 0.4%E; Y/Y: 4.2% V 4.7%E; CORE CPI Y/Y: 3.4% V 3.7% PRIOR
(KR) SOUTH KOREA DEC DEPARTMENT STORE SALES Y/Y: +7.6% V -0.5% PRIOR
(AU) AUSTRALIA DEC NEW AUTO SALES M/M: -5.9% - VFACTS
(JP) JAPAN DEC MONETARY BASE Y/Y: 13.5% V 19.5% PRIOR (10-month low)
(AU) AUSTRALIA DEC AIG PERFORMANCE OF SERVICE INDEX: 49.0 V 47.7 PRIOR (3-month high; 3rd month of contraction)
(JP) JAPAN DEC VEHICLE SALES Y/Y: +21.3% V 24.1% PRIOR
(CO) COLOMBIA DEC PRODUCER PRICE INDEX (PPI) M/M: 0.1% V 0.1% PRIOR; Y/Y: 5.2% V 6.8% PRIOR
Markets Snapshot (as of 04:30GMT)
Nikkei225 -0.6%
S&P/ASX -1.1%
Kospi +0.3%
Taiwan Taiex +0.4%
Singapore Straits Times +0.6%
Shanghai Composite +0.3%
Hang Seng +0.4%
S&P Futures -0.2% at 1,271
Feb Gold +0.3% at $1,617/oz
March Crude -0.2% at $103.06
Overview/Top Headlines
Markets continued to be weighed down by EU debt crisis; Greece continues to warn that it may have to drop out of the EU within 3-months in an uncontrolled default. Asian indices that were in positive territory failed to hold their upward momentum, with risk aversion and some profit taking from yesterday's rally.
Euro remained weaker against the USD, $1.2920 and yen ¥99.10. The greenback found modest strength against the majors and weakened against the emerging market currencies. Oil eased off its highs in the US session as the US and EU take additional steps to implementing fresh sanctions against Iran. Reminder that Iran has warned any embargo would lead it to close off the key Gulf oil shipping lane the Strait of Hormuz. Corn and wheat contracts fell while copper and silver both gained 1.1%.
China Min of Commerce Chen expects that 2011 trade surplus was approx $160B (in line with prior guidance and lower than $183B in 2010), total trade balance $3.6T and retail sales may increase by approx 17% y/y. South Korea disclosed that China was the largest net buyer of South Korean bonds among foreign investors, however South Korea's total 2011 bond issuance fell 4% to KRW568.2T. In South Korea's monthly economic report stated that the South Korean economy showed moderating growth mainly in exports and the manufacturing industry due to continuing external uncertainties... Economic uncertainties will likely continue to constrain domestic consumption and production in the future.
AUD/USD tested below $1.0330 testing the $1.0310 level after Australia November trade surplus came in at a 9-month low of A$1.38B, this was also lower than the expected A$1.7B. Both exports and imports were flat m/m. Iron ore exports reached a 7-month low A$4.92B v A$6.34B prior.
Speakers/Geopolitical/In the press
(IN) India Central Bank Dep Gov Gokarn: India inflation is above the tolerated level; Ceiling has been reached on interest rates
(CN) Economists point to downbeat comments from Premier Wen as indication the PBoC will once again cut RRR before the start of Lunar New Year in late Jan - SCMP
(HK) According to Centaline Hong Kong property transactions fell to a 5-year low in 2011 - HK press
(CN) China to create Centralized Securities Lending Exchange (CSLE) to facilitate short selling ability as early as this quarter - FT
Equities
HSBC, 5.HK: May start second round of layoffs in Hong Kong after the Lunar New Year, letting go 1,000 employees - HK press
Samsung Electronics, 005930.KR: Targeting to exceed 15% growth in home appliances in 2012 - Korean press
Elpida, 6665.JP: Confirms in talks with several clients on possible financial support, nothing has been decided yet
JX, 5020.JP: President: In talks with Saudi Arabia in case there is an Iran oil embargo
PTR: Reports 2011 natural gas production +4.1% y/y to 75.5B sq meters - Chinese press