Asian Market Update: March 14, 2012

(JP) BANK OF JAPAN (BOJ) LEAVES TARGET RATE RANGE UNCHANGED BETWEEN 0.0% TO 0.10%, AS EXPECTED; NO NEW MONETARY EASING ANNOUNCED

(AU) AUSTRALIA JAN HOME LOANS M/M: -1.2% V -0.6%E (first decline in 10 months); INVESTMENT LENDING: -7.1% V 7.5% PRIOR; OWNER-OCCUPIED HOME LOAN VALUE: 0.1% V 2.0% PRIOR

(AU) AUSTRALIA FEB NAB BUSINESS CONDITIONS: 3 V 2 PRIOR; NAB BUSINESS CONFIDENCE: 1 V 4 PRIOR (5-month low)

(UK) UK FEB RICS HOUSE PRICE BALANCE: -13% V -14%E (19-month high)

(JP) JAPAN JAN TERTIARY INDUSTRY INDEX M/M: -1.7% V +0.2%E (10-month low)

(NZ) NEW ZEALAND FEB QV HOUSE PRICES Y/Y: 2.9% V 2.7% PRIOR (17-month high)

(NZ) NEW ZEALAND FEB FOOD PRICES M/M: 0.6% V 0.0% PRIOR (7-month high)

(PH) PHILIPPINES JAN TOTAL EXPORTS Y/Y: 3.0% V -18.5%E; TOTAL MONTHLY EXPORTS: $4.1B V $3.3B PRIOR

(PH) Philippines Dec Foreign Direct Investment (FDI); $43M v $366M prior

(AR) Argentina Feb Trade Balance: $1.3B v $550M prior

(NZ) New Zealand Feb REINZ house Price Index m/m: +0.8% v -1.4% prior (3-month high); House Sales y/y: 37.0% v 25.2% prior

Markets Snapshot (as of 04:30GMT)

Nikkei225 +0.9%

S&P/ASX +1.1%

Kospi +1.3%

Taiwan Taiex +1.4%

Singapore Straits Times +0.8%

Shanghai Composite +0.3%

Hang Seng +1.3%

S&P Futures +0.5% at 1,379

April gold +0.3% at $1,704/oz

April Crude +0.6% at $106.99

Overview/Top Headlines

Markets saw a return of risk appetite today, ahead of US Fed policy meeting and key ZEW data from Germany. One of the major investment banks raised its 2012 GDP estimate on China, despite China itself lower its own estimate last week. Commodities were all stronger with silver and copper contracts both up over 0.8% to $33.69 and $3.86 respectively. In a Greece debt analysis report it saw debt-GDP ratio falling well below 120% by 2020 target if debt swap participation rose above 96%. EU's Juncker said he does not expect Greece to require a third bailout; A successful debt exchange will cut Greece debt to 117% of GDP in 2020. He also noted that the budget plan for Belgium could be evaluated in the coming days. It was also announced that Spain has agreed to an additional deficit cut of 0.5% of GDP beyond what has been announced. Reminder on March 2nd following the EU Leader Summit Spain PM Rajoy announced that Spain revised its 2012 deficit-to-GDP ratio higher to 5.8% from 4.4% prior target but did maintain 2013 deficit-to-GDP target of 3.0%. Rajoy stated at the time of the declaration: "This was a sovereign decision made by Spain.." EUR/USD held some mild strength in the session gaining about 0.1% which was similar for the pound and Swiss franc.

The Bank of Japan leaves the target rate unchanged between 0.0 to 0.1%, as expected. However the BoJ did increase the size of loan scheme targeting growth sectors by ¥2T to ¥5.5T. Announces dollar denominated growth loans worth ¥1T and also said they would introduce loans worth ¥500B for small lot investments. Board member Miyao proposed increasing asset buying and loan scheme by ¥5T, proposal was rejected 8 to 1. As expected the volume of asset purchases unchanged at ¥65T. USD/JPY fell over 0.3% to around the ¥81 level. EUR/JPY also fell 0.3% to ¥107.95. In New Zealand economic data showed that both housing and food prices are rising, the NZD/USD gained half a percent $0.8221.

Speakers/Geopolitical/In the press

(KR) Korea govt may issue credit cards offering oil tax rebates if global oil prices rise above $130/brl - Korean press

(CN) S&P: China banks should be able to overcome any slump, performance will moderate in 2012 but stay healthy

(KR) South Korea Fin Min Bahk: Reiterates rising oil prices and a possible slowdown in China are risks to South Korea

(JP) Japan cabinet expected to approve consumption tax increase plans on Mar 23rd before submitting to Diet - Japan press

(US) Fed criteria for latest round of stress tests to include unemployment rate as high as 13%, equity price decline of 50%, and housing price decline of 21%; Results will be released on Thur, Mar 15th at 16:30ET - financial press

Equities

China Overseas Land, 688.HK: Reports Feb property sales HK$13.1B, +209% y/y

Mongolian Mining Corp, 975.HK: China coking coal demand will increase 2-3% in 2012

CHT: Reports Feb net NT$2.9B v NT$3.3B m/m; Rev NT$15.5B v $16.8B y/y

MF: Customers reportedly have received offers for claims and will receive nearly all of the missing $1.6B in funds back - NYT Dealbook

NEC, 6701.JP: Aims to raise its infrastructure business sales by 50% to ¥500B in the next 4-5 years - Nikkei News

Cathay Financial, 2882.TW: In talks with larger Chinese banks of a cross stake agreement - Taiwan press

HBC: Will focus on six core and 2 strategic markets in Asia outside of Hong Kong and sell or close retail operations in another 7 countries - FT