Economic Data
(HU) HUNGARY SEPT ECONOMIC SENTIMENT: -25.0 v -24.7 PRIOR; BUSINESS CONFIDENCE: -16.4 v -14.9 PRIOR; CONSUMER CONFIDENCE: -49.5 v -52.7 PRIOR
(TW) TAIWAN AUG UNEMPLOYMENT RATE: 4.3% V 4.3%E
(VN) VIETNAM SEPT CPI: Y/Y: 6.5% V 5.2%E
(IS) Israel Aug Leading 'S' Indicator M/M: 0.1% v 0.2% prior
Markets Snapshot (as of 03:30GMT)
Nikkei225 -0.5%
S&P/ASX -0.5%
Kospi -0.7%
Shanghai Composite +0.3%
Hang Seng -0.3%
Dec S&P500 -0.1% at 1,451
Dec gold -0.8% at $1,764/oz
Nov Crude oil -0.8% at $92.17/brl
Notes/Observations
Asian equity markets opened the week on the back foot led by Shanghai Composite falling over 1% in the morning session before staging a technical rebound late in the day. Europe-related concerns weighed on initial sentiment as Saturday meeting between Germany's Merkel and France's Hollande opened a rift in the implementation of the banking union process, with the former calling for a cautious approach and the latter preferring to move as quickly as possible.
Separately, Greek finance ministry was forced to dodge German press speculation that its budget needs may be twice the reported amount around €10B, and Spanish fin min de Guindos moved further away from pushing for a bailout. Elsewhere, Italian finance officials echoed similar caution regarding surrendering their sovereignty in exchange for condition-based OMT funds.
In the FX markets, AUD and NZD were initially the weakest currencies against the greenback before coming off the lows. USD/JPY also touched ¥78 handle but failed to break below the figure. Euro was down over 50pips to test below $1.2930 but bounced back to $1.2950. Thin Sunday trade exacerbated volatility in precious metals, where Dec silver was briefly down over 2% and gold down over 1%. Both have also come off the lows, retracing about half of their early losses.
Fixed Income/Currencies/Commodities
GLD: SPDR Gold Trust ETF daily holdings rise by 9.4 tons to 1,317.8 tons (highest since 1,318.9 tons in Jul 2010) - Update as of Sept 21st.
(JP) Japan food prices affected by high grain prices; govt planning to raise imported wheat price sold to the private sector by an avg of 3% on 1st Oct.
(AU) Australia Newcastle weekly coal exports for week ended Sept 24th -13.8% w/w
Speakers/Political/In the Papers
Japan
(JP) Japan PM Noda: Japan's economy may weaken further due to recent dispute with China over Senkaku islands. - US financial press
(JP) BANK OF JAPAN (BOJ) RELEASES AUG POLICY MEETING MINUTES; several said BoJ should not exclude any policy options due to risks from European crisis, suggest sending strong message it will take bold steps if required; MoF official stated that hope BoJ takes decisive measures to achieve inflation goal of 1%; Under subscriptions in JGB purchasing partly reflect speculation it may remove min bidding.
(JP) Following Fridays expected reappointment of PM Noda as head of the DPJ (ruling) party, the PM admitted that the current political environment facing him is not favorable; DPJ Sec Gen Azuma Koshiishi to remain as No 2.
(JP) The three major Japanese banks, Bank of Tokyo-Mitsubishi UFJ, Sumitomo Mitsui Banking Corp, and Mizuho Financial Group Inc are increasing efforts to buy foreign currencies, especially the USD, in response to increased lending to foreign firms.
(JP) BoJ estimates current account balance to reach new record of ¥44.3T. - financial press
Australia
(AU) Australia govt: Final FY11/12 budget deficit reported at A$43.7B v A$44.4B estimated in May.
(AU) Australia Treasurer Swan: Fiscal position still in good shape; still committed to surplus in FY12/13.
China
(CN) China think tank CCWE sees 2012 GDP at 7.8%, 2013 at 8.0%. - Chinese press
(CN) NDRC researcher Wang Yiming: China will not have a problem reaching 7.5-8.0% GDP. - Chinese press
(CN) China State Researcher Ba Shusong: China policy loosening to be relatively moderate. - Chinese press
(CN) China Ministry of Housing and Urban-Rural Development: Property prices are not in condition to rebound; Govt set to continue to control the property market. - Shanghai Daily
Europe
(IE) Ireland think tank ESRI sees additional public cuts needed to address budget deficit. - Irish Times
(PT) Portugal govt planning to launch talks with trade unions and industry management on alternatives to austerity measures amid ongoing criticism over govt cuts. - financial press
(ES) Spain Fin Min de Guindos: will not rush to take external aid to finance its debt. - financial press
(EU) European Parliament president Schulz: Creation of single European banking regulator likely to take longer than expected. - German press
(GR) Greece Finance Ministry refuted German press speculation that Greece needs to cover a €20B budget shortfall to meet international conditions for more bailout funds. - financial press
(EU) Saturday meeting between German Chancellor Merkel and France Pres Hollande said to have exposed a deep rift over the key provision in the euro zone crisis - closer checks on the banking sector.
Asia Equities
FMG.AU: S&P: The new credit facility is Credit Positive
CBA.AU: To offer A$700 incentives to home owners that switch their loan from another lender - AFR
Renesas 6723.JP: Govt backed fund in Japan said to consider bailout of Renesas over concerns that a takeover proposed by KKR could disrupt supply chains - financial press
Daiwa Securities 8601.JP: To pull out of Asia derivatives business and lower staff count in Hong Kong - Nikkei News
Takashimaya 8233.jp May report H1 op profit of about ¥10.5B v ¥9.1B y/y; Rev ¥420B, +2% y/y - Nikkei News
US Equities
AAPL: Seeks additional $707M in payment from Samsung Electronics on top of the $1.05B verdict press
GS: Laying off about 100 of its partners (about 20% of total) - UK press
UTX: Plans to invest more in China following opening of its Otis unit in China - China Daily
RMBS: Judge for the Northern District of California rules that the Rambus patents are valid; SK Hynix has infringed on patents and owes royalty payments.