Economic Data
(NZ) NEW ZEALAND Q1 RBNZ 2 YEAR INFLATION EXPECTATION: 2.2% V 2.3% PRIOR (15-quarter low)
(PH) PHILIPPINES DEC TRADE BALANCE: -$1.3B V -$1.6B PRIOR
(TW) TAIWAN JAN UNEMPLOYMENT RATE: 4.2% V 4.2%E
Markets Snapshot (as of 04:30 GMT)
Nikkei225 -2.2%
S&P/ASX -0.8%
Kospi -0.6%
Shanghai Composite +0.3% at
Hang Seng -0.8%
Mar S&P500 flat at 1,487
Apr gold flat at $1,592/oz
Apr Crude Oil +0.3% at $92.52/brl
Notes/Observations
Murky results of Italian elections and fears over a political stalemate weighed heavily on sentiment, sending USD and JPY sharply higher against EUR, and high-beta FX. Steep losses in US indices are also being tracked by declines in the Asian markets.
Italian ministry appears to have confirmed that center-left candidate Bersani was victorious in the lower house of parliament, but the senate race is expected to be too close to call until Tuesday afternoon. All indications point to a deadlock, which may require either a grand coalition or another technocratic govt and another elections. Bersani noting he has a mandate to rule by virtue of lower house victory.
USD/JPY tested below ¥91 handle and EUR/JPY below ¥119 in late US hours, down 3 and 6 big figures respectively, as traders take profit on short-yen trade amid Italian uncertainty.
RBA's Debelle sent AUD/USD down about 50 pips, noting the central bank still has plenty of scope to lower cash rate to offset impact of bank funding costs.
Speakers/Political/In the Papers
(IT) Italy Center Left (Bersani) said to have won the Senate races in Piedmont and Friuli regions - financial press citing Ministry data
(IT) Italy Center Left (Bersani) said to have won majority in the lower house (as expected) - financial press
(IT) Italy PM Monti: Satisfied with election results for centrist coalition
(IT) Italy Center Left (Bersani) official: Going back to the polls is not an option given the result; lower house election winner has the responsibility to form a Govt
(JP) Japan Abe cabinet approval rises for 2nd straight month to 69.6% - Sankei News
(JP) Japan Diet (parliament) will vote on BoJ Gov nominees Mar 14-15 - Kyodo press
(JP) Japan Econ Min Amari: Currency moves may be the result of uncertainty in Italian elections
(KR) Bank of Korea (BoK) Gov Kim: South Korea consumer inflation expectations high; policy should not target currency levels - addressing parliament
(AU) Australia Newspoll shows Opposition Leader Tony Abbott is preferred to Labor PM Gillard 40-36% - Australia press
(NZ) New Zealand to raise minimum wage to NZ$13.75 from NZ$13.50 - financial press
(US) Fed's Lockhart (moderate, not a voting FOMC member): Fed can press forward with bond buying; Policy remains very accommodative; US GDP seen at 2-2.5% in 2013, could surprise to the upside.
(US) WSJ's Hilsenrath: Fed's Bernanke will not signal a big change in policy at this week's Congress testimony - CNBC
Currencies
Sharp currency moves during U.S, session gave way to calm during Asian session, as the market paused to digest deadlocked voting results in Italy parliamentary elections. USDJPY and EURJPY saw wild moves during U.S. session 300 and 600 pips respectively to reach US-session lows of ¥90.85 and ¥118.70. USDJPY was relatively quiet during Asian session, recovering some of its sharp losses to reach a high around ¥92.70. Japan Econ Min Amari commented that the sharp JPY moves were directly related to Italy elections, and Japan Fin Min Aso declined specific comments, only saying that stable FX moves were desired. EURJPY regained a portion of its earlier losses reaching a high of ¥121.30 as JPY weakened and EUR remained stuck at 1.3050-1.3080 range. NZDUSD saw a local drop of about 10 pips on the release of RBNZ 2 year inflation expectations, which came in at 2.2% a 15 quarter low. AUDUSD fell about 50 pips to $1.0250 in the wake of comments from RBA's Debelle indicating the central bank still has some easing ammunition. Onshore currencies TWD, PHP, KRW, and MYR were little changed from yesterday's levels.
Fixed Income/Commodities
JGB: (JP) Japan 10yr Note yield falls to 10-year low 0.68%
JGB: (JP) Japan 5-yr Note yield declines to record low of 0.115%
(SG) S&P: Singapore prudent budget supports AAA sovereign rating
(CN) China PBoC to sell CNY5B in 28-day repos - financial press
GLD: SPDR Gold Trust ETF daily holdings fall by 7.8 tons to 1,272.9 ton (lowest since Aug 16th)
Equities
Bank of East Asia 23.HK: Reports FY12 Net profit HK$6.06B v HK$4.9Be
005380.KR: Hyundai/Kia group said to be sharply raising its vehicle prices in US markets to offset strong KRW impact - Korean press
Nissan 7201.JP: CEO: Sees neutral rate in USD/JPY at ¥100 - financial press
NTT DoCoMo 9437.JP: CEO: Open to M&A deals outside of Asia; will not be necessarily sticking to minority investments - financial press
VAH.AU: Reports H1 Net A$23M v A$51.8M y/y, Rev A$2.11B v A$2.00B y/y; CEO Borghetti: Domestic performance exceeding expectations, airfares will rise as capacity stabilizes; -4.6%
OSH.AU: Reports FY12 Net $175.8M v $170Me, Rev $724.6M v A$732.9M y/y; -0.9%
SVW.AU: Reports H1 Net A$258M v A$52.1M y/y, Rev A$2.70B v A$1.96B y/y; +3.6%
RHC.AU: Reports H1 Net A$148.2M v A$132M y/y, Rev A$2.07B v A$1.97B y/y; +0.8%
CZR: Reports Q4 -$3.75 v -$1.70e, R$2.02B v $2.11Be; -7.5% afterhours
ADSK: Reports Q4 $0.53 v $0.49e, R$606.9M v $585Me; -2.2% afterhours