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Australia Market to open lower This week we get PMI data
Japan Markets closed Autumninal Equinox Day re-opens Tuesday.
Later Inflation data and PMI data.
S Korea Markets closed Chuseok Holiday re-open Wednesday
Taiwan Markets closed Mid Autumn Festival re-open Tuesday.
This week we get an Interest Rate decision, Unemployment data, along with Retail Sales, Money Supply and Export Ordersdata
China Market closed Mid Autumn Festival re-open Wednesday
HK ADR’s -174pts at 24,493 broad weakness and with China and other regional markets closed volumes are likely to be light.
Europe gets Consumer Confidence data, PMI data and an ECB meeting. German PPI and Ifo data. French Business Confidence and Climate Indicator, UK BoE meeting, Public Sector borrowing
US FOMC meeting this week Housing data in focus this week and PMI data. Also this week a ‘Quad’ meeting which underlines how many Asian countries are improving their ties with the US.
France recalls its ambassadors from the US and Australia following the decision for Australia to get nuclear powered submarines and cancelling its existing contract with France. The deal is part of the US looking to build up military resistance to China. The
Russia and China agree to co-operate in trying to prevent instability arising from the Taliban takeover of Afghanistan.
Iron ore fell below US$100 a metric tonne for the first time in 14 months as China’s moves to clean up its heavy-polluting industrial sector spurred a swift collapse. Futures prices sunk to as low as US$99.50 a tonne on the Singapore Exchange and wavered at about US$100 a tonne through the overnight trading session, which is daytime trading hours in the US.
FT reports Authorities in New Jersey and Texas are pursuing actions against cryptocurrency group Celsius Network for allegedly offering unregistered securities, as regulators crack down on issuers of digital asset lending products.
Apple and Google have removed a tactical voting app made by supporters of jailed Russian opposition leader Alexei Navalny from their online stores following strong pressure from the Kremlin, as three days of voting began in the country’s parliamentary elections.
UK battles to contain gas price crisis Surge in gas prices puts suppliers out of business and threatens sectors from food to steel
FT Weekend Opinion Inflation is back with a vengeance — but is that a bad thing? By Sebastian Mallaby the Paul A Volcker senior fellow for international economics at the Council on Foreign Relations. Looks at the modern incarnation of the Blinder view on inflation which has three arguements.
The first is that the current price spike will prove transitory.
The second dovish argument suggests that inflation might actually be welcome. The world economy faces profound structural change; the move to remote working, climate change and revisiting supply chains. All of which will require workers moving from from old economy jobs to new ones and that will see real wages in such jobs falling. Which harkens back to Blinders view that joblessness is worse than rising prices.
The third element that ‘the inflation demon can be exorcised more easily than myth would have it? The idea that eradication is prohibitively costly stems from 1980-1982, when the Fed had to engineer two back-to-back recessions to slay the great inflation of the previous decade. But that disaster is unlikely to be repeated.’
He concludes ‘Contrary to what Blinder suggested, inflation can resemble cancer. But it is the kind of cancer that spreads over the course of years. Given that the current price surge may prove transitory, and that modest inflation can be a useful thing, it is much too soon for central bankers to panic.’Companies & Markets
Rising fears over Evergrande’s debt pile hit insurer Ping An
• Shares slide on contagion worries • Group cites ‘zero exposure’ to developer. Looks at how Evergrande may not be the only developer in trouble and how there is likely to be a knock on impact to suppliers and financiers (both banks and insurers).
Trouble is looming in riskier corporate debt by Eric Platt
Worries are growing that the corporate bonds market is heading for trouble, especially since the borrowing terms are increasingly riskier for the lenders. Whilst the borrowers are likely to run into problems in the future. An interesting read.
Barron’s lead is on oral drugs to deal with covid. Other highlights are on the Mining Companies; who are in good shape and acting with discipline. The jury is out on whether the commodities boom will continue but the miners are focusing on minerals needed for renewable power.
Also Apple’s latest releases, Nike’s caution; highlights from Thursday’s earnings call and the impact of Vietnam’s shutdown and that growth in China may disappoint.
DOW -0.48%, NDX -0.91%, S&P %, Russel 2K +0.18 %
Markets opened flat but trended lower through the day with quadruple witching on the closebv. With concerns about the resurgent covid virus. With Large Cap Tech names under pressure ahead of the FOMC meeting this week with hopes of more detail about tapering. The FDA rejected a plan to givebooster shots of Pfizer -1.3% and BioNTech’s -3.6% vaccines (Moderna -2.4%). Invesco +5.5% after the Wall Street Journal reported the money manager is in talks to combine with State Street’s asset-management business.
The Senate Finance Committee has put forward a proposal to end the tax advantage of ETF’s and close the loopholes that the wealthy use to defer paying gains taxes.
Banks JPMorgan Chase -0.3%, Citigroup +0.2% Wells Fargo +0.4%, Amex +0.8%
Work from home names: Facebook -2.2%, Apple -1.8%, Amazon -0.7%, Netflix +0.5%, Disney +0.1%, Zoom Video +3.4%, Alphabet -2% and Microsoft -1.8%,
Tech NXP Semi -1.7%, Nvidia -1.5%, Micron -0.4%, AMD -2.2%, Skyworks -2%
Re-opening stocks Boeing, Caterpillar -1.9%, Simon Property %, Kohl’s -0.2%, Nordstrom +0.7%, Gap +0.6%, United Airlines +0.2%, Carnival +2%, Wynn Resorts -1.3%, Chevron -0.6%, Exxon Mobil -1.2%,
Lock down names Campbell Soup -0.8% General Mills +0.3%, JM Smucker +0.3%
Michigan Data Prelim
Consumer Expectations Sept 67.1 vs 65.1 Aug (F/cast was 66)
5 yr Inflation Expectation Sept 2.9% vs 2.9% Aug (F/cast was 2.8%)
Consumer Sentiment Sept 71 vs 70.3 Aug (F/cast was 71.5)
Inflation Expectations Sept 4.7% vs 4.6% Aug (F/cast was 4.6%)
Current Conditions Sept 77.1 vs 78.5 Aug (F/cast was 78.5)
Baker Hughes Oil Rig Count 411 vs 401 prior
Baker Hughes Total Rig Count 512 vs 503 prior
USD holds near three week highBitcoin +0.98% @ 47,750.00, VIX +22.3% @ 20.8, US T10 @ 1.363%
OIL Brent -0.44%, WTI -0.88%
Gold -0.16%, Silver -1.9%, Copper -0.97% Platinum +0.82%, Palladium -0.79%.
AHEAD NAHB Housing Market Index, UN General Assembly.
DAX -1.03%, CAC -0.79%, FTSE -0.91%
Markets opened higher but trended lower and closed at the day lows. UK retail sales were weaker than expected for a fourth month -VE plus concerns about slowing growth worry the market. Travel & Leisure lead the gains whilst Basic Resources were weak.
Dometic Group +1% after agreeing to a $677 million deal to buy U.S. drinkware manufacturer Igloo.
Anglo American -8.2% after UBS and Morgan Stanley both downgraded the stock and cut their price targets.
Current Account Jul €30.2B vs €24B Jun (F/cast was €29.1B)
Construction Output Jul 3.3% YoY vs 28% Jun (F/cast was 3.4%)
Core Inflation Rate Aug 1.6% YoY vs 0.7% Jul (F/cast was 1.6%)
Inflation Rate Aug 3% YoY vs 2.2% Jul (F/cast was 3%)
Inflation Rate Aug 0.4% MoM vs -0.1% Jul (F/cast was 0.4%)
Retail Sales Aug -0.9% MoM vs-2.8% Jul revised (F/cast was 0.7%)
Retail Sales Aug 0% YoY vs 1.9% Jul revised (F/cast was 2.8%)
Retail Sales Ex Fuel Aug -1.2% MoM vs -3.2% Jul revised (F/cast was 0.9%)
Retail Sales Ex Fuel Aug -0.9% vs 0.9% Jul revised (F/cast was 2.6%)
Eurozone No data due
France No data due
UK No data due
Market closed for Autumnal Equinox Day
No data due.
Tokyo reported 862 new covid cases Saturday (+80 DoD but -411 from last Saturday). Nationally the tally was 4,702.
Japanese households held a record 1,992 trillion yen ($18 trillion) worth of assets at the end of June, up 6.3 percent from a year earlier, as the coronavirus pandemic continued to curb spending and stock prices gained, according to Bank of Japan data.
Cash and deposits rose 4.0 percent to 1,072 trillion yen, a fresh record high, partly because of summer bonus payments.
Leaders of the United States, Japan, India and Australia will agree to take steps to build secure semiconductor supply chains when they meet in Washington next week, the Nikkei business daily said on Saturday, citing a draft of the joint statement.
Two of the candidates vying to become Japan's next prime minister denied on Saturday they had toned down their positions on nuclear energy and gender issues to attract conservative backing in a tight ruling party leadership election this month.
The winner of the Sept. 29 contest to lead the Liberal Democratic Party (LDP) is almost certain to succeed Yoshihide Suga as the country's next premier because the party has a majority in the lower house.
Shinsei Bank's (8303.T) board has decided to use a poison-pill defence against an unsolicited $1.1 billion bid from shareholder SBI Holdings (8473.T), the Japanese lender said on Friday, as it scrambles for ways to thwart the takeover. Shinsei plans to issue stock warrants to existing shareholders which would dilute SBI's stake, it said in a statement after a board meeting. -VE
Toyota Motor Corp. is planning to use hydrogen transported by a Kawasaki Heavy Industries Ltd. ship from Australia for the company’s hydrogen-powered cars as early as next year.
Hydrogen is expected to be an important energy source in the decarbonization drive. +VE
Markets closed for Chuseok re-opens Thursday
No data due
Sunday KDCA reported 1,910 new covid cases (1,871 local infactions)
More than 60 cryptocurrency exchanges in South Korea must notify customers of a partial or full suspension of trading by Friday midnight, a week before a new regulation comes into effect. To continue operating, exchanges must register with the Financial Intelligence Unit by Sept. 24, providing a security certificate from the internet security agency. They must also partner with banks to ensure real-name accounts. -VE
Disney+, the US entertainment giant’s streaming service, is expected to land in Korea via LG U+ first, the smallest of the country’s three IPTV providers. Then, it may team up with KT, the largest of the three, to further expand its reach. Earlier, Disney officially announced the Nov. 12 launch of Disney+, with a monthly subscription fee of 9,900 won ($8.40). +VE LG U+
Posco said Friday it has established a 1 million-ton production facility for giga steel, an ultrahigh-strength steel product used for cars. Amid the expanding global market for eco-friendly cars and rising demand for lightweight vehicles, Posco said it has invested about 500 billion won ($425 million) since 2017 to build and expand the production facility for the high-strength steel inside the Gwangyang steel mill in Gwangyang, South Jeolla Province +VE.
Eastar Jet Co., a debt-ridden South Korean budget carrier, said Friday it has submitted restructuring plans to a bankruptcy court to finalize an acquisition deal with a local property developer, aiming to resume flights next year. +VE
Hyundai Motor Group has begun test operating a robot to inspect safety at its automotive plant, in collaboration with robotics startup Boston Dynamics, the group said Friday. Hyundai Motor Group, which operates two leading automotive companies Hyundai Motor and Kia, said it has deployed Spot, Boston Dynamics’ quadruped robot, to inspect safety at Kia AutoLand Gwangmyeong, Kia’s automotive plant facility in Gyeonggi Province. +VE
KT, one of South Korea’s leading telecom companies, said Friday it has created an organization dedicated to new investments and external partnerships in a bid to speed up the firm’s transformation into a digital platform business. +VE
Shinhan Bank said Friday that it has acquired a minority stake in a local information and communication technology solutions and services provider to bolster its partnership for development of a new corporate banking platform.
Market closed Mid Autumn Festival re-opens Tuesday
No data due
CECC reported 12 new covid cases on Saturday but there are concerns about a rise in cases after the Mid Autumn festival.
Taiwan's economy minister expressed concern on Friday about China's "sudden" decision to apply to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and said it hoped it did not affect the island's application.
China filed to join the free trade agreement in a letter to New Zealand's trade minister, Damien O'Connor.
Innolux Corp which makes flat panels used in TVs and computers, yesterday said it is cutting production amid weakening demand and slumping prices. The flat-panel maker’s comments came as demand began losing steam last month after experiencing the industry’s longest boom of one-and-a-half years.
“The flat-panel industry is cyclical by nature. After a long period of upticks, it is normal to see price adjustments,” Innolux chairman Jim Hung told reporters on the sidelines of a media briefing in Taipei. -VE
With COVID-19 coming under control in Taiwan, roughly two of every five employers in Taiwan believe their hiring will return to normal within six months, according to a survey by human resources advisory firm ManpowerGroup.
Market closed Mid Autumn Festival re-opens Wednesday
No data due.
Covid-19 cases climbed again in Fujian, China’s southeastern province battling the country’s latest outbreak of the pandemic
, as local authorities stepped up travel restrictions and suspended mass activities ahead of the upcoming Mid-Autumn Festival -VE.
China to use market tools to stabilise commodities says Premier Li, with macro level policies calibrated to the precise requirements of local businesses. +VE
On Saturday The People's Bank of China (PBOC) initiated 7-day and 14-day reverse repos of RMB50 billion each. The successful bidding rates for the 7-day and 14-day reverse repos were 2.20% and 2.35%, respectively. The single-day net investment reached RMB100 billion today.
China's Ministry of Culture and Tourism (MCT) shall do well in four key areas during the Mid-Autumn Festival and National Day holidays, CCTV.COM citing Hou Zhengang from the ministry's market management department. Firstly, MCT aims to sternly prevent the importation of Covid cases. Outbound and inbound group tours, as well as "air ticket + hotel accommodation" operations offered by travel agencies and online tourism firms will be suspended. Equally, a circuit breaker mechanism for cross-provincial travel will be strictly in place. Accordingly, trans-provincial group tours and "ticket + hotel" reservation services in provincial regions labelled as medium- or high-risk areas will be halted immediately.
Japan has said China’s “readiness” to join a transpacific trade pact originally designed by Washington to limit Chinese influence in the region would need to be judged on its merits after Beijing filed a surprise formal application. For China to sign up to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, started by former US President Barack Obama, Beijing would need to meet the deal’s requirements in areas related to intellectual property, state subsidies and state-owned enterprises, Japan said. But the US could invoke a clause in its trade agreement with Canada and Mexico to block China’s application to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a government official said yesterday.
The China-US Financial Roundtable meeting was held virtually on Thursday, focusing on the sector regulation and consolidation measures recently imposed by China, Bloomberg citing sources. Both sides talked about boosting the transparency of Beijing's sector oversight and reorganization.
Beijing said other countries’ patrols in the South China Sea
were “provoking incidents” and “creating contradictions” as it rejected a German warship’s port call request. -VE for relations with Germany which had hoped theport visit would ease tensions about its joining the UK aircraft carrier’s Far East Tour.
Chinese consumers have placed more than 2 million pre-orders for the new 5G iPhone 13 line through Apple’s official store on JD.com as of Thursday, surpassing the 1.5 million iPhone 12 pre-orders on the same platform a year earlier, as the world’s largest smartphone market finds fewer high-end models on offer amid the decline of Huawei Technologies. +VE Apple
ADR’s -174pts at 24,493 broad weakness and with China closed volumes are likely to be light. HK reported 3 imported covid cases on Sunday.
Data due after market
Inflation Rate Aug (Jul was 3.7%)
Short Selling HSI Friday 16% vs 18.5% Thursday
Top Shorts Henderson Land (12) 48%, BYD Co (1211) 41%, Country Garden (2007) 39%, Xinyi Glass (868) 34%, Bud Apac (1876) 30%, Petrochina (857) 27%, Li Ning (2331) 27%, China Life (2628) 25%, HSBC (5) 25%.
Hong Kong's political elite began selecting a powerful committee on Sunday which will choose the city's next leader and nearly half the legislature under a new "patriots only" system imposed by Beijing.
China Evergrande Group has begun repaying investors in its wealth management products with real estate, a unit of its main Hengda Real Estate Group Co Ltd unit said. Evergrande, with over $300 billion in liabilities, is in the throes of a liquidity crisis here that has left it racing to raise funds to pay its many lenders and suppliers. It has a bond interest payment of $83.5 million due on Thursday. The company said in a WeChat post dated Saturday that investors interested in redeeming wealth management products for physical assets should contact their investment consultants or visit local offices.
CENTRAL CHINA (00832.HK) announced that on 17 September, Wu Po Sum, the Chairman and a controlling shareholder, through its wholly-owned Joy Bright, further acquired in aggregate 4.1 million additional Shares at the average price of HK$1.56 per Share on the open market.
XIAOMI-W (01810.HK)'s statement disclosed that, on 17 September, it repurchased 892,400 shares of the company on the Stock Exchange, at a price ranging between $22.95-23 per share, involving a total amount of about $20.52 million.
SUNWAH KINGSWAY (00188.HK) announced the results for the year ended 30 June 2021. Net profit was $31.76 million, against the loss of $40.93 million from a year ago. EPS was 4.44 cents. Final dividend amounted to 1.5 cents.TENCENT (00700.HK)'s statement disclosed that, on 17 September, it has repurchased 230,000 shares of the company on the Stock Exchange, at a price ranging between $445.4-467.4 per share, involving approximately $106 million.CKH HOLDINGS (00001.HK)’s statement disclosed that on September 17, it repurchased 280,000 shares of the company on the Stock Exchange at a price between $52.4-53.45 per share, involving a total of about $14.85 million.
INSPUR INT'L (00596.HK) announced that Eric Kong Lee has resigned as the chief executive officer of the Company with immediate effect due to his other personal and business commitments. Following the resignation of Mr. Lee, the Company will no longer offer the position of chief executive officer. The duties of the chief executive officer will be borne by the General Manager of the Company. Meanwhile, Wei Daisen has been appointed as a General Manager of the Company.HYSAN DEV (00014.HK) announced to acquire a completed office/retail mixed used development known as “City Link” located at Xinzha Road, Shanghai from CK ASSET (01113.HK). The Consideration is an amount equal to RMB3.5 billion (equivalent to approximately HK$4.235 billion).
YUZHOU GROUP (01628.HK) announced that on 17 September, Lam Lung On, the chairman and a controlling shareholder of the Company, has acquired 3 million shares of the Company on the market for an aggregate consideration of HK$3.3952 million.SIHUAN PHARM (00460.HK) announced that, on 17 September, the Company repurchased a total of 1 million shares of the Company on market at an average price of HK$2.129 per Share. The aggregate purchase price paid was approximately HK$2.13 million.HKR INT'L (00480.HK) announced to purchase a retail cum office building, namely Jinsha INCITY located at Qiantang District, Hangzhou from Hangzhou Runhao at a total consideration of RMB414 million (equivalent to approximately HK$499 million).HUISHENG INTL (01340.HK) announced that, on 15 September, the Company disposed of 10,000 HK AERO TECH (01725.HK) Shares on open market, together with the 160,400 Previous Sale Shares disposed, at an aggregate consideration of approximately HK$2.836 million. The Group expects to recognise a book gain in aggregate of approximately HK$2.615 million.EVERGRANDE (03333.HK) attaches great importance to some managers' early redemption of the Evergrande Wealth Investment Products, according to an official web announcement. The group has asked those six managers to return all monies redeemed in advance by deadline, along with severe punishment.A main lender to the debt-strapped Evergrande Group has made loan loss provisions, while some creditors plan to give the Chinese developer more time to repay, Reuters citing sources. ABC (01288.HK) has reportedly made some loss provisions for certain loan exposure to Evergrande.
HKEX (00388.HK) published a consultation paper, seeking market feedback on proposals to create a listing regime for special purpose acquisition companies (SPACs) in Hong Kong.
Bonnie Chan, HKEX Head of Listing, said she noted about the market concern that whether SPAC will run against the clampdown initiatives on "shell stock" speculations. Chan underscored that the proposals in the consultation paper forbid any assets which do not meet listing conditions to float by SPAC.
The proposals laid out requirements for the scale of initial fundraising, issuer qualifications, redemption rights and acquisition targets, in alignment with the prevailing reverse takeover regulations and measures to combat backdoor listing.
The Hong Kong Monetary Authority (HKMA) published the statistics of payment cards issued in Hong Kong for the second quarter of 2021. According to the quarterly statistics, the total number of credit cards in circulation was 19.22 million by the end of Q2/2021. The figure represents a 0.5 per cent decrease from the previous quarter and a 1.5 per cent decrease from the previous year. The number and value of credit card transactions are susceptible to seasonal factors and the general economic environment, making the trends more prone to fluctuation. The total number of credit card transactions was 236 million for Q2/2021, representing a 7 per cent increase from the previous quarter and a 15.3 per cent increase from the same period in 2020.
The total value of credit card transactions was HK$172.1 billion for Q2/2021, representing a 1.1 per cent decrease from the previous quarter and a 19.4 per cent increase from the same period in 2020. Of the total transaction value, HK$142.2 billion was related to retail spending in Hong Kong, HK$20.3 billion in retail spending overseas and HK$9.6 billion in cash advances.China's MIIT has recently come up with special guidance opinions on external link management, announced TENCENT (00700.HK)'s WeChat official account. Accordingly, WeChat will put interconnection into practice under the bottom line on safety to ensure high-quality platform content and excellent user experience. Based on these principles and under regulators' guidance, WeChat will roll out the phased external link management steps bit by bit. The first stage will begin from 17 September. After upgrades, users will be allowed to visit external links in one-on-one chats under the premise of information security.The Stock Exchange published a consultation paper seeking market feedback over the next 45 days on proposals to create a listing regime for special purpose acquisition companies (SPACs) in Hong Kong. The deadline for responses is 31 October 2021.
Accordingly, the subscription for and trading of a SPAC’s securities would be restricted to professional investors only. This restriction would not apply to the trading of the Successor Company shares post the De-SPAC Transaction.Centa-City Leading Index (CCL) last stood at 189.14, down 0.33% weekly. In the last seven weeks, the CCL rose for the first two weeks, before falling for the next two weeks, and then picked up for two weeks again, with the trend staying in volatility.
The research department of Centaline Property, said CCL Mass in New Territories East last reported at 208.27, up 2.43% weekly, logging the sharpest increase in the past 12 weeks.CKH HOLDINGS (00001.HK) and the Qatari mobile telecoms company Ooredoo announced to combine their respective Indonesian telecommunication businesses, Indosat Ooredoo and H3I. The MergeCo will be named PT Indosat Ooredoo Hutchison.
Canning Fok, Group Co-Managing Director of CKH HOLDINGS, said at the press conference that upon the merger of the two companies, the MergeCo will become a larger-sized company, and is projected to be Indonesia's second largest telco, serving 100 million customers and earning annual revenue of approximately US$3 billion. The merger will also help Indonesia build a better telecom network and render better customer services there. The Group deems Indonesia as one of its major destinations outside Hong Kong, Fok added.