Economic Data
(SG) SINGAPORE SEPT ELECTRONIC EXPORTS Y/Y: -16.4% V -8.6%E; NON-OIL DOMESTIC EXPORTS M/M: 1.6% V 2.8%E; Y/Y: -3.4% V +1.2%E
(AU) AUSTRALIA AUG WESTPAC LEADING INDEX M/M: 0.5% V 0.3% PRIOR
(NZ) New Zealand Sept online job vacancies m/m: -4.5% v +2.6% prior; skilled job vacancies m/m: -5.4% v +4.9% prior
Markets Snapshot (as of 04:00GMT)
Nikkei225 +1.5%
S&P/ASX +0.9%
Kospi +0.8%
Shanghai Composite +0.1%
Hang Seng +1.0%
Dec S&P500 -0.2% at 1,447
Dec gold +0.3% at 1,752/oz
Nov Crude Oil +0.1% at $92.20/brl
Notes/Observations
Asian equity markets are tracking higher across the board after a second consecutive session of impressive gains in US indices. Aside from surprise resignation of Citi CEO Pandit, financials are generally faring fairly well here at the start of the new earnings season, even as tech giants appear to lag. Reporting after close, both Intel and IBM are down just over 3% - the former on soft guidance and latter on weak top line results.
Looking ahead, Bank of America, BlackRock, and American Express are on tap for Wednesday. In terms of economic data, a relatively quiet session today foreshadows a raft of monthly metrics and quarterly GDP out of China tomorrow. Increasing number of analysts anticipate Q3 growth to bottom before a rebound in the final quarter.
Moody's shocked the euro to the upside in early Asian trade after it kept Spain sovereign rating at investment grade on the heels of a catch-up cut from S&P just last week. Notably, Moody's indicated that Madrid's risk of losing market access has been materially cut, and any willingness of ECB to buy Spanish debt is a positive.
Moody's also kept its negative outlook and warned that the risks to its baseline scenario are high and skewed to the downside, and also that the rating was dependent on Spanish government to continue to be able to refinance its maturing debt at affordable rates. Earlier, euro dipped on PM Rajoy denying overnight press speculation on rumors of an ECB credit line before rising some 70 pips as high as $1.3120 on the Moody's (lack of) action.
In commodities space, BHP released its Q1 production report with iron ore down slightly q/q but up y/y. Copper rose 24% while aluminum output fell 14% y/y. Speaking after the announcement, BHP CEO said China steel demand has peaked and mining firms are under increasing pressure, adding that record commodity prices of past ten years will not return in the next ten years. Share of BHP opened modestly higher and kept its gains just above the 1% mark.
Second round of US presidential debates were scored more positively for the incumbent, as InTrade reelection probabilities gave Obama a 2pt boost in their aftermath to 64%. US equities and USD/JPY moved modestly lower, the reverse of the first contest which was generally believed to have been won by the challenger.
Fixed Income/Currencies/Commodities
(AU) Australia MoF (AOFM) sells A$500M in 5.5% 2023 bonds ; avg yield 3.1465%; bid-to-cover 5.02x
SLV: iShares Silver Trust ETF daily holdings fall to 9,861 tons from 9,885 tons (lowest level since 9,841 on Sept 17th)
(US) API PETROLEUM INVENTORIES CRUDE: +3.7M V +1.5ME (largest build since late August); GASOLINE: -1.18M V +500KE; DISTILLATE: +1.79M V -1ME; UTILIZATION: 86.7% V 87.3% W/W
(CN) China Commerce Ministry (MOFCOM): Produce prices fell 5.5% w/w in the week ended Oct 14th - Shanghai Daily
Speakers/Political/In the Papers
(US) According to CNN.com, about 46% of respondents saw Barack Obama winning 2nd presidential debate vs 39% for Mitt Romney
(US) According to Intrade, the odds of Pres Obama reelection rose about 2pts to 64% following 2nd presidential debate
(JP) Japan may use existing ¥910B budget for stimulus; stimulus plan may require deficit bonds - Japanese press
(JP) Japan business leader expects tension with China to continue - Kyodo News
(CN) China Ministry of Defense: Navy vessels' activities around Senkaku/Diaoyu islands are legitimate - Chinese press
(CN) China govt researcher Chen Daofu: China economy to bottom in Q3 and will recover in Q4 - Chinese press
(CN) NYU Economist Roubini: Concerned China may see a hard landing in 2013 - financial press
(CN) China Sept Power Consumption y/y: +2.9% v +3.6% prior - NEA
Asia Equities
Mitsubishi Corp 8058.JP: To invest $200M in geothermal facility in Indonesia - Nikkei News
JX Holding 5020.JP: May report H1 pretax profit around ¥80B, -66% y/y but better than decline of ¥83% projected - Nikkei News
Panasonic 6752.JP: To cut LCD panel production for televisions next FY, to focus on LCD panel production for tablet computer devices - Nikkei News
BHP: Reports Q1 Iron Ore production 39.8M tons v 40.9M tons q/q v 39.6M tons y/y
CSL.AU: Guides FY13 Rev higher by approx 10% and net profit up by about 12% - financial press
TAH.AU: Reports Q1 Rev A$488.9M v A$475.2M y/y
US Equities
APOL: Reports Q4 $0.52 v $0.49e, R$996M v $1.01Be; -8.9% afterhours
ISRG: Reports Q3 $4.46 (includes one time benefit) v $3.48e, R$538M v $535Me; -5.1% afterhours
IBM: Reports Q3 $3.62 v $3.62e, R$24.7B v 25.4Be; -3.4% afterhours
INTC: Reports Q3 $0.58 v $0.50e, R$13.5B v 13.2Be; -3.3% afterhours
CSX: Reports Q3 $0.44 v $0.44e, R$2.89B v $2.94Be; +1.3% afterhours
CREE: Reports Q1 $0.27 adj v $0.26e, R$315.8M v $317Me; +8.3% afterhours