Economic Data
(AU) AUSTRALIA Q2 GROSS DOMESTIC PRODUCT (GDP) Q/Q: 0.6% V 0.7%E; Y/Y: 3.7% V 3.7%E
(AU) AUSTRALIA AUG AIG PERFORMANCE OF SERVICE INDEX: 42.4 V 46.5 PRIOR (7th month of contraction)
(CN) CHINA AUG HSBC SERVICES PMI: 52.0 V 53.1 PRIOR; one-year low
(NZ) NEW ZEALAND Q2 VALUE OF ALL BUILDINGS SA: 0.8% V 3.0%E
(HK) HONG KONG AUG PURCHASING MANAGERS INDEX (PMI): 50.5 V 50.3 PRIOR
(KR) SOUTH KOREA AUG FOREIGN EXCHANGE RESERVE: $316.9B V $314.4B PRIOR
(TW) TAIWAN AUG CPI Y/Y: 3.4% V 2.6%E; WPI Y/Y: -0.9% V -1.8%E
(PH) PHILIPPINES AUG CONSUMER PRICE INDEX (CPI) M/M: 0.8% V 0.7%E; Y/Y: 3.8% V 3.5%E; CORE CPI Y/Y: 4.3% V 4.1% PRIOR
(UK) UK BRC SHOP PRICE INDEX Y/Y: 1.1% V 1.0% PRIOR
(CO) COLOMBIA AUG CPI M/M: +0.5% V -0.2% PRIOR; Y/Y +0.1% V -0.3% PRIOR
Markets Snapshot (as of 03:00GMT)
Nikkei225 -0.8%
S&P/ASX -0.8%
Kospi -1.4%
Shanghai Composite -0.1%
Hang Seng -1.1%
Taiwan Taiex -0.9%
Straits Times Index -0.4%
Sept S&P500 -0.2% at 1,403
Dec gold flat at $1,694/oz
Oct Crude oil +0.1% at $95.38/brl
Overview/Top Headlines
Asian equity markets are drifting lower, taking their cue from US indices decline following the disappointing manufacturing ISM. Thursday remains in focus in terms of event risk, with ECB rate decision and any details on its bond-buying plan keeping investors on edge. US session saw more veiled commentary from European officials, as ECB board member Asmussen further foreshadowed more details on the program to be announced by ECB Pres Draghi.
In the currency markets, weakness in the high-beta commodity majors continued to be felt most acutely in the Aussie dollar. AUD pared its post neutral-RBA-statement bounce, briefly falling below $1.02 handle following the release of a disappointing Q2 GDP report. Q/Q missed consensus by a decimal at 0.6% while y/y growth was in line at 3.7%. Consumption component rose 0.8%, down from 1.4% prior, and terms of trade fell 0.6% vs -4.1% prior. Australia Treasurer Swan noted growth remains solid, while PM Gillard continued to cheer the outlook for the clearly slowing resource sector.
China markets also remained under modest pressure as government officials remain unenthused about 2012 prospects. Finance Minister Xie said he could not be particularly optimistic over the exports situation. Separately, a report by MIIT and CASS warned that 2012 industrial production could slow from 13.9% in 2011 down to 10% in 2012.
Looking ahead, Switzerland releases its CPI data following a disappointing GDP report overnight that saw Q2 growth falling sequentially for the first time in 3 years. Bank of Canada is widely expected to keep rates on hold at 1.00%, however some analysts are anticipating a slightly more hawkish tone.
Speakers/Geopolitical/In the press
(JP) BoJ member Miyao: Economy seen to resume moderate recovery; to steadily proceed with powerful easing via asset purchases
(CN) China Aug new yuan loans estimated around CNY600B vs CNY540B in July - Chinese press
(CN) China Railway Authority raises its 2012 spending budget on railway construction from CNY470B to CNY496B - Shanghai Daily
(AU) Australia Resource Min Ferguson: Will not offer payments to close coal-fired power stations; ends discussions with power stations
(AU) Australia PM Gillard: Outlook for the mining sector is strong; Sees about A$500B in the sector investment pipeline
(NZ) New Zealand PM Key: Goods exports to China up 3x over four years; on track for NZ$20B in annual trade with China by 2015
Equities
005930.KR: Galaxy S3 was the top-selling smartphone in US in August
BHP: CEO: Guides FY13 production at 240M BOE, +8% y/y - Barclays Energy & Power conference (update)
TM: Requests suppliers to reduce prices - Japanese press
Hon Hai: Seeking more involvement in Sharp small LCD production - Japanese press
US Equities
FDX: Lowers Q1 EPS guidance to $1.37-1.43 v $1.56e (guided $1.45-1.60 prior); -2.8% afterhours
ALTR: Mid quarter update: Reiterates Q3 Rev 2-6% q/q (implies $474.1- 492.7M v $483Me); +0.5% afterhours