Economic Data
(CN) CHINA SEPT NEW HOME PRICES M/M: FELL IN 22 OF 70 CITIES V 19 PRIOR; Y/Y: FELL IN 55 OF 70 CITIES V 53 PRIOR
(CN) CHINA Q3 REAL GDP Q/Q: 2.2% V 2.0%E; Y/Y: 7.4% V 7.4%E (3 1/2 year low); YTD: 7.7% V 7.7%E
(CN) CHINA SEPT INDUSTRIAL PRODUCTION Y/Y: 9.2% V 9.0%E (first rise in 4 months); YTD: 10.0% V 10.0%E
(CN) CHINA SEPT RETAIL SALES Y/Y: 14.2% V 13.2%E (6-month high); YTD: 14.1% V 14.0%E
(CN) CHINA SEPT FIXED ASSETS INVESTMENT EXCLUDING RURAL YTD Y/Y: 20.5% V 20.2%E (6-month high)
(CN) CHINA SEPT NEW HOME PRICES M/M: FELL IN 22 OF 70 CITIES V 19 PRIOR; Y/Y: FELL IN 55 OF 70 CITIES V 53 PRIOR
(AU) AUSTRALIA Q3 NAB BUSINESS CONDITIONS: -2 V -3 PRIOR
(AU) AUSTRALIA SEPT RBA FOREIGN EXCHANGE TRANSACTIONS (A$): 396 V 351 PRIOR
(KR) SOUTH KOREA SEPT DEPARTMENT STORE SALES Y/Y: -0.8% V -6.9% PRIOR; DISCOUNT STORE SALES Y/Y: +0.2% V -3.3% PRIOR
(NZ) NEW ZEALAND SEPT ANZ NZ JOB ADS M/M: -2.9% V +0.6% PRIOR
Markets Snapshot (as of 04:00GMT)
Nikkei225 +1.9%
S&P/ASX +1.0%
Kospi +0.2%
Shanghai Composite +1.0%
Hang Seng +0.6%
Dec S&P500 flat at 1,457
Dec gold -0.2% at 1,750/oz
Nov Crude Oil -0.8% at $92.16/brl
Notes/Observations
Asian equity markets are putting in another session of strong gains, with positive sentiment following overnight hold of Spain by Moody's feeding through to lower bond yields across the European periphery, on top of strong US housing data, driving more buyers into risky assets. Economic data out of China dominated today's headlines, removing more uncertainty related to China slowdown but also painting a less bleak picture of the managed mainland landing than feared. Q3 GDP did in fact fall to fresh 3.5-year low at 7.4% - in line with consensus - but subsequent commentary reinforced perceptions of Q4 tracking stronger.
On the flip side, September industrial production rose for the first time in 4 months and topped estimates by 0.2points, while retail sales growth was a full point above expectations at 14.2%. National Bureau of Stats (NBS) said growth stabilized and reiterated its 7.5% GDP objective for this year, also pledging to keep prudent monetary policy. Furthermore, NBS spokesperson noted that upward CPI pressures still exist, and easing actions by Western central banks required particular attention.
This latest set of comments and economic data will increasingly bolster expectations of PBoC on hold for a more extended period, in fact it has not moved on RRR since May and 1-year rates since July. Fiscal stimulus typically reserved for the new government in a once-a-decade political transition is now the more likely shot in the arm to China economy, shifting the focus to the party summit early next month.
In the currency markets, AUD/USD saw the most volatility in the wake of China data, coming within 5 pips of $1.04 handle in the aftermath of the release before comments out of NBS tempered bullish momentum. USD also remained on the offensive against the JPY, rising to 1-month highs above ¥79 handle on earlier speculation regarding more BOJ easing due to slow progress toward achieving its 1% CPI target. EUR/JPY cross bears extra attention in European session ahead of the 10-year Spanish auction after backing off from multi-month high of ¥103.85.
Fixed Income/Currencies/Commodities
(JP) Japan's MoF sells ¥1.10T 20-yr 1.7% JGBs; Avg yield: 1.689% v 1.671% prior; bid-to-cover: 3.81x v 4.54x prior
(KR) Exporters increasingly concerned with the strength of KRW after USD/KRW fell to near 1-year low around 1,100 - Korean press
VALE: Reports Q3 Iron Ore production at 83.9M tons 80.5M tons q/q
Speakers/Political/In the Papers
(AU) Australia Finance Min Wong: Budget surplus is appropriate for economy growing at trend
(AU) Australia Treasury: Investment will not grow as strong as thought at the time of the budget
(KR) South Korea Ministry of Knowledge Economy: Sept industrial electricity sales rose 3.5% y/y to 21.2B kwh - Korean press
(GR) Germany has been working for some time with EU, ECB and IMF on the next bailout tranche for Greece (unofficially); Official position remains they will wait to see Troika report before making a decision - Der Spiegel
Asia Equities
TM: Exec: Denies press speculation that Toyota would temporarily close some of its China factories amid bilateral tensions - China Daily
005380.KR: Hyundai Kia Auto Group inventories in US are at new record lows amid strong US demand and last month's strikes - Korean press
WOW.AU: Reports Q1 Rev A$15.22B +4.3% y/y
WPL.AU: Reports Q3 Rev $1.83B v $1.43B q/q, +39% y/y; Production 26.5MMBOE v 20.1MMBOE q/q; Raises FY production to 83-86MMBOE (guided prior 77-83MMBO)
STO.AU: Reports Q3 Rev A$851M, +15% y/y; production at 13.5MMBOE, +6% y/y; maintains FY production guidance at 51-55MMBOE
NCM.AU: Reports Q1 gold production at 460.4k oz, -22% y/y; maintains FY12/13 production guidance
002502.CN: White House investigation said to have found no evidence of spying by Huawei - financial press
US Equities
ALGN: Reports prelim Q3 $0.28 v $0.29e, R$136.5M v $140Me; -19.9% afterhours
STLD: Reports Q3 $0.15 adj v $0.13e, R$1.69B v $1.76Be; -3.2% afterhours
XLNX: Reports Q2 $0.46 v $0.41e, R$543.9M v $548Me; -0.6% afterhours
EBAY: Reports Q3 $0.55 v $0.55e, R$3.40B v $3.41Be; -0.3% afterhours
AXP: Reports Q3 $1.09 v $1.09e, R$7.86B v $7.9Be; -0.2% afterhours
NE: Reports Q3 $0.45 v $0.50e, R$884M v $898Me; +0.5% afterhours
LRCX: Reports Q1 $0.53 v $0.41e, R$906.9M v $904Me; +1.3% afterhours
CLWR: Sprint said to take control of CLWR with co-investors Comcast and Intel - US financial press; +4.4% afterhours