Economic Data
(AU) Australia Sept Conference Board Leading Index: -0.8% v 0.0% prior (first decline in 4 months)
(SL) SRI LANKA CENTRAL BANK LEAVES REPURCHASE RATE UNCHANGED AT 7.75% (AS EXPECTED); LEAVES REVERSE REPO RATE UNCHANGED AT 9.75% (AS EXPECTED)
Markets Snapshot (as of 04:00GMT)
Nikkei225 -0.4%
S&P/ASX +0.1%
Kospi -0.6%
Shanghai Composite -0.6%
Hang Seng closed
Dec S&P500 -0.1 at 1,428
Dec gold flat at 1,726/oz
Dec Crude Oil +0.3% at $88.89/brl
Notes/Observations
Asian equity markets were largely in a holding pattern after what seemed like another session of heavy losses on Wall St saw a final-hour bounce. Investors' focus now turns to China HSBC Flash Manufacturing PMI on tap for tomorrow and a Fed policy decision on Wednesday, particularly whether the former will confirm an upturn in Q4 and the latter acknowledges some improvement in labor and housing sectors. JPY saw the most pronounced volatility, as it fell to multi-month lows against USD and EUR. USD/JPY briefly touched the key psychological ¥80 handle amid speculation the BOJ will take an even more aggressive easing approach with a ¥20T increase to asset purchase program. Fin Min Jojima squashed those rumors, sending the dollar down some 20 pips toward ¥79.80. Jojima did reiterate he wants BOJ to continue to pursue powerful monetary easing to achieve 1% inflation goals, while Econ Min Maehara indicated he would consider sitting in on the next policy decision.
US presidential candidates held their final debate with the focus loosely revolved around foreign policy. Pres Obama - perceived as the aggressor - was seen as a victor based on some 48% of respondents vs 40% for the challenger. As was the case in the 2nd debate, Dec S&P500 futures traded down slightly following the conclusion of the debate, falling about 2pts below 1,430 level.
Fixed Income/Currencies/Commodities
AUD/USD: According to IMF, Australian Dollar is the most expensive out of G20 when valued against a basket of good and services' US production costs - SMH
USD/JPY: Testing the ¥80 handle; Highest level since early July
EUR/JPY: Rises above ¥104.50; Fresh 5-month highs
GLD: SPDR Gold Trust ETF daily holdings rise by 2.7 tons to 1,336.9 tons (highest since Oct 12th)
US corn harvested across 18 select states: 87% v 79% last week v 60% y/y
Speakers/Political/In the Papers
(CN) Former PBoC advisor Li: China equity valuations are too low; China's slowdown not large in terms of unemployment
(CN) According to Shanghai Deovolente Realty Co, Shanghai new home sales last week fell 17.5% to 208.8K sqm; Avg price sold rose to CNY22.0K/sqm vs CNY20.1K/sqm w/w - Shanghai Daily
(AU) RBA's Ridout: Australia has a multi-speed economy; High AUD driving structural change across economy and weighing on manufacturing; Unemployment expected to rise slightly higher; Mining boom not yet over; stronger resource exports still to come; Rates policy should aid the housing sector
(NZ) Reserve Bank of New Zealand (RBNZ) and its new governor Wheeler widely expected to keep overnight cash rate unchanged at 2.50% tomorrow - NZ Herald
(JP) Japan PM Noda and leaders of opposition parties have failed to reach an agreement regarding passage of a deficit-financing; Timing of next election said to be the main point of contention - Nikkei News
(ES) MOODY'S DOWNGRADES FIVE SPAIN REGIONS; affirms other regions; Downgrades Andalucia, Extremadura, Castilla-La Mancha, Catalunya, And Murcia. Extremadura (Ba1) cut due to persistently high operating deficit and poor liquidity. Andalucia (Ba2), Castilla-La Mancha (Ba3), Catalunya (Ba3) and Murcia (Ba3) cut due to poor liquidity as well as large maturing debt obligations.
Asia Equities
TM: Global output in calendar 2012 now estimated at 9.8-9.9M units, below 10.05M prior target - Nikkei News
Fuji Heavy 7270.JP: Raises H1 Net to ¥40.0B from ¥23.0B; raises op profit to ¥43.0B from ¥32.0B; Lowers Rev to ¥898B from ¥910B
Kansai Electric 9503.jp To raise household electricity rates by 10%; effective April - Asahi News
Hitachi Construction 6305.JP: May report FY12/13 op profit around ¥56B, +2% y/y but below ¥72B most recent forecast; Rev seen falling 9% y/y to ¥740B, first decline in 3 years and below ¥820B forecast - Nikkei News
Posco PKX: S&P cut rating to BBB+ from A-; outlook Stable
OZL.AU: Reports Q3 total copper production 25.7K tons v 25.5K q/q, gold production 31.1K oz v 34.5K q/q
OSH.AU: Reports Q3 Rev A$107.8M v A$211.3M q/q, Oil and gas production 1.33MMBOE v 1.8MMBOE q/q
BHP: BHP Billiton Mitsubishi Alliance workers to receive 5% pay hike over next 3 years as part of the settlement with unions - AFR
US Equities
WDC: Reports Q1 $2.36 (adj) v $2.31e, R$4.0B v $3.99Be; Guides Q2 $1.65-1.85 v $2.44e, R$3.55-3.7B v $4.12Be; -6.3% afterhours
VECO: Reports Q3 $0.34 adj v $0.31e, R$126.9M v $130Me; -4.6% afterhours
TXN: Reports Q3 $0.52 (ex items) v $0.46e, R$3.39B v $3.34Be; -0.3% afterhours
YHOO: Reports Q3 $0.35 (non-GAAP) v $0.26e, R$1.09B v $1.08Be; +4.6% afterhours