Euro Tests Above $1.26; Japan Committed To Powerful EasingEconomic Data
(CN) CHINA APR INDUSTRIAL PROFITS YTD Y/Y: -1.6% V -1.3% PRIOR (3rd consecutive decline); APR Y/Y: -2.2% v +4.5% prior
(JP) JAPAN APR CORPORATE SERVICE PRICE INDEX Y/Y: 0.2% V -0.2%E (First rise in 4 months)
(JP) BANK OF JAPAN (BOJ) MONETARY POLICY MEETING MINUTES FOR APR 27TH: WILL CONTINUE TO PURSUE POWERFUL EASING
(UK) UK MAY HOMETRACK HOUSING SURVEY M/M: 0.2% V 0.1% PRIOR; Y/Y: -0.6% V -0.9% PRIOR (multi-month high)
(VN) VIETNAM MAY INDUSTRIAL PRODUCTION Y/Y: 6.8% V 7.5% PRIOR
(TH) THAILAND APR MANUFACTURING PRODUCTION INDEX ISIC Y/Y: 0.54% V 2.8%E
(VN) VIETNAM CENTRAL BANK CUTS REVERSE REPURCHASE RATE IN OPEN MARKET OPERATIONS 100BPS FROM 12% TO 11%
Markets Snapshot (as of 05:00GMT)
Nikkei225 unchanged
S&P/ASX +0.8%
Kospi closed
Singapore Straits Times Index +0.3%
Shanghai Composite +0.1%
Hang Seng +0.3%
June S&P Futures +0.8% at 1,325
June gold +0.4% $1,575/oz
July Crude +1.0% at $91.73
Overview/Top Headlines
Over the weekend as many as 6 weekend Greece opinion polls show support for New Democracy (ND, pro-austerity) party at 25.6-27.7%; Syriza (anti-bailout) support at 20.1-26%. EUR/USD took this as positive news for June 17th elections and the possibility that Greece could stabilize. EUR/USD tested $1.2610 while AUD/USD gained in the session over 120 pips to $0.9870, USD was weaker against the swissie, yen and NZD as well as a return for risk appetite returned to the markets.
Former Greece PM Papademos said the Government may not meet its obligations beyond late June assuming further installments of aid do not come from the EFSF and IMF. Some tempers flared after IMF head Lagarde said to have made some controversial comments in UK press interview this weekend, stating: "As far as Athens is concerned, I also think about all those people who are trying to escape tax all the time... And I think they should also help themselves collectively [by] paying their tax." Greece Pasok Leader Venizelos: Allegations by IMF head Lagarde that Greeks who do not pay taxes are an insult. Greece Pasok Leader Venizelos reiterates proposal to soften Greece bailout terms; says one year extension already received support from EU's Juncker.
Spanish press reported that Spain govt may request at least another €30B from EFSF to recapitalize its banking sector if risk premiums remain around 500bps above bunds. There was also a report that Spain was considering recapitalizing Bankia with funds raised from Spanish government bond funds in exchange for shares.
China reported April industrial profits over the weekend with the third consecutive decline. China Industrial Bank chief economist Lu Zhengwei said "China's economy is slowing down, so profit growth will also be slower this year. The pace may pick up a bit in coming months if the economy rebounds after policy easing filters through." RBA Governor Stevens commented that recent economic data from China has shown some weakness, though he attributed it to mostly concerns over Europe's situation.
Speakers/Geopolitical/In The Press
(CN) China takes steps to open markets: China Banking Regulatory Commission (CBRC) has declared that private capital will have the same entry standards as state capital when it comes to domestic banks. - Chinese press
(NZ) New Zealand PM Key: Wants to expand bilateral relationships with Germany, the EU and NATO; Will meet with the BoE's King on trip to the UK.
(CN) Shanghai new home sales w/w: +27.0% v -23.5% prior; new home prices +15.95% v +1.93% prior. - UWIN
(IR) Indonesia Central Bank Dep Gov: No plans to implement capital controls; Intends to manage IDR and USD liquidity.
(KR) South Korea Pres Lee: Confident can reach a free trade agreement with China within 2 years. - Korean press
Equities
BHP: South Australia Mine Min: BHP will not get an extension approved for Olympic Dam unless it has started mining by the end of the year.
OZL.AU: Affirms FY12 copper production 100-110K tons (likely towards the bottom half); On track for gold production.
2317.TW: Foxconn has received the orders from Apple for iTV, as expected. - Financial press
Tencent, 700.HK: Planning to invest $1B in e-commerce unit to meet rising demand for online shopping. - China Daily
WPL.AU: Exec: Actively assessing multiple opportunities, balance sheet is strong; Affirms 2012 production 73-81MMBOE.