Economic Data
(AU) AUSTRALIA SEPT NAB BUSINESS CONDITIONS: -3 V 0 PRIOR; NAB BUSINESS CONFIDENCE: 0 V -3 PRIOR
(JP) JAPAN AUG CURRENT ACCOUNT TOTAL: ¥455B V ¥421BE; ADJUSTED CURRENT ACCOUNT TOTAL: ¥722B V ¥520BE; TRADE BALANCE: -¥645B V -¥629BE
(NZ) NEW ZEALAND Q3 NZIER BUSINESS OPINION SURVEY: +8 V -4 PRIOR (first sequential increase in 4 quarters)
(NZ) NEW ZEALAND SEPT NZ CARD SPENDING - RETAIL M/M: -0.6% V -0.3%E; TOTAL M/M: -0.6% V +2.4% PRIOR
(NZ) NEW ZEALAND SEPT QV HOUSE PRICES Y/Y: 5.3% V 4.8% PRIOR
(UK) UK SEPT BRC SALES LIKE-FOR-LIKE Y/Y: +1.5% V -0.2%E (highest reading since Dec 2011)
(UK) UK SEPT RICS HOUSE PRICE INDEX: -15% V -20%E (6-month high)
Markets Snapshot (as of 03:30GMT)
Nikkei225 -0.4%
S&P/ASX +0.7%
Kospi +0.3%
Shanghai Composite +2.0%
Hang Seng +1.1%
Dec S&P500 +0.2% at 1,453
Dec gold +0.3% 1,780/oz
Nov Crude Oil +1.0% at $90.21/brl
Notes/Observations
Asian equity markets are trading firmer with the exception of Tokyo, where traders are playing catch-up to yesterday retreat and JPY strength. Risk-on mode evident in US futures and high-beta FX majors is unfolding despite the downbeat semiannual World Economic Report from IMF, which cut 2012 GDP growth forecast to +3.3% from +3.5% and 2013 GDP to +3.6% from +3.9% July view.
Regionally, IMF cut China 2012 GDP to 7.8% from 8.0% prior and also cut India 2012 GDP to 4.9% from 6.1% prior, but raised US 2012 growth to 2.2% from 2.0% prior. AUD/USD rose over 50pips to near $1.0250, helped in part by press speculation that critics of Australia's carbon tax plan are not deferring investments as feared. AUD also shrugged comments from RBA Dep Gov Lowe who pointed to softer labor markets and warned that a peak in mining investment is quickly approaching. Lowe further suggested that China demand for resources will remain strong, even though global miner BHP announced it would reduce its iron ore staff amid falling demand.
Out of Europe, Moody's downgraded Cyprus sovereign rating 3 notches to B3 from Ba3 with Negative Outlook, citing banking sector's difficulties cutting into domestic credit growth. In Greece, Troika inspectors were said to adjust adverse scenario forecasts for nation's debt levels to 150%/GDP by 2020 vs prior forecast of 146%/GDP. Separately, an IMF official raised projections for Greece debt to GDP ratio to 170.7% in 2012 and 181.8% in 2013. Elsewhere, Eurosceptic Dutch finance minister De Jager called for Greece to make a more concerted effort in fiscal consolidation and expressed opposition to giving Greece more time if there are additional costs attached.
Fixed Income/Currencies/Commodities
(KR) Bank of Korea: Japan, South Korea agree to expiration of increased bilateral fx swap arrangements
(CN) PBoC offers CNY100B in 28-day reverse repos and CNY165B in 7-day reverse repos
STT: Plans to enact negative interest rates effective Nov 1st; To charge 0.25% on Swiss Franc deposits - financial press
EUR/CHF: Rises about 40 pips to CHF1.2140 amid overall CHF weakness following reports of negative interest rates charged on CHF-denominated deposits by State Street
GLD: SPDR Gold Trust ETF daily holdings rise by 7.1 tons to 1,340.5 tons (record high)
Speakers/Political/In the Papers
(JP) ADB President Kuroda: To raise SE Asia economic forecasts; Boj has may tools available such as buying JGBs, shares, and private debt
(JP) Japan PM Noda continued to reject demands by opposition to set date on dissolving Diet (update) - Japan Times
(JP) Japan Econ Min Maehara: Wants BoJ to show results quickly in price goal of 1%
(JP) Japan cabinet office considering cutting economic outlook for 3rd straight month - Yomiuri News
(CN) China Index Academy: Sept home prices across 100 major cities rose 0.17% m/m to CNY8,753/sqm; 4th month of increase - Shanghai Daily
(CN) Bank of Communications analysts estimate China Sept CPI falling to 1.8% from 2.0% in Aug - Korean press
(AU) RBA Dep Gov Lowe: Labor market appears to have softened in recent months
(KR) Bank of Korea (BOK): To increase policy efforts to facilitate growth; Economy faced with bigger downside risks, may trail potential until the end of 2013
(AU) Coogee Chemicals, one of the earlier critics of Australia's carbon tax, has reversed its position on the impact of the tax on investment - The Age
(NZ) New Zealand PM Key rejected idea of a manufacturing crisis in the country - Dominion Post
Asia Equities
FujiFilm 4901.JP: Exec: Business discussions in China on hold due to recent protests; production not affected
NSANY: Said to have posted Sept China vehicle sales ex imports seen -34.6% y/y
HMC: CR-V unit recall to affect 490k globally - financial press
NEC: Increases lithium ion storage capacity - Nikkei News
1398.HK: Industrial and Commercial Bank and Bank of China receive full banking licenses in Singapore - China Daily
Hyundai Heavy 009540.KR: Said to have been awarded $3.2B plant order in Saudi Arabia - financial press
BHP: May reduce headcount and redeploy staff in iron ore division - financial press
OSH.AU: Sells a stake in its Gulf Of Papua assets to Total - financial press
BBG.AU: Names Ian Pollard as a Chairman - financial press
US/Europe Equities
EW: Reports prelim Q3 R$448M v $478Me (prior guided $465-485M on Jul 24th); -15.8% afterhours