Asian Futures HK ADR’s -154pts and Australia falling in early trades. Japan and S Korea closed. China likely to open higher on EU trade deal but pre market PMI data important.
US Futures opened flat Dow +15pt, S&P and NDX flat. US reports that the UK discovered variant has been found in the US Southern California.-VE for sentiment.
DOW +0.24%, NDX +0.15%, S&P +0.13%, Russel 2K +1.05% markets opened higher and traded sideways or slightly lower through the day but still hit new highs. Energy and Materials the best performing sectors. Bitcoin continued to rally to new highs too. AstraZeneca +0.6% on news of its vaccine’s approval for emergency use in the UK. Sentiment +VE on hopes of larger stimulus payments although the Senate has rejected the House bill, MrConnell did introduce a new bill linking increased payments to demands from Trump over tech and the election.
US covid cases continue to tick higher. But sentiment encouraged that 2021 will be better as vaccinations bring the covid pandemic under control +VE Consumer names.
Banks JPMorgan Chase +0.3%, Citigroup -0.1% and Wells Fargo -0.1%, AMEX +1.1%
Work from home names: Facebook -1.8%, Apple -0.9%, Amazon -1.1%, Netflix -1.2%, Disney +2.2%, Zoom Video -0.1%, Alphabet -1.2% and Microsoft -1.1%,
Tech NXP +2.2%, Nvidia +1.6%, Micron +2.4%, AMD +1.8%, Skyworks +1.6%
Re-opening stocks Boeing +0.2%, Caterpillar +1.9%, Simon Property +0.8%, Kohl’s +3.6%, Nordstrom +4%, Gap +2%, United Airlines +2.1%, Carnival +1.7%, Wynn Resorts -0.8%, Chevron +0.9%, Exxon Mobil +0.8%,
Lock down names Campbell Soup -0.9% General Mills -1%, JM Smucker -0.5%
Goods Trade Balance Adv Nov $-84.82b vs -80.42b Oct (F/cast was -83b)
Wholesale Inventories Adv Nov -0.1% MoM vs +1.1% Oct (F/cast was +0.5%)
Chicago PMI Dec 59.5 vs 58.2 Nov (F/cast was 56.9)
Pending Home Sales Nov +16.4% YoY vs +20.2% Oct (F/cast was +17.5%) Pending Home Sales Nov -2.6% MoM vs -0.9% Oct revised from -1.1% (F/cast was +0.3%)
EIA Gasoline Stocks Change -1.192m vs -1.125m prior (Consensus was +1.662m)
EIA Crude Stocks Change -6.065m vs -0.5625m prior (Consensus was -2.583m)
Baker Hughes Total Oil Rig Count 351 vs 348 prior
USD was weaker vs Yen & Euro. Bitcoin +4.4% @ 28,953.25, VIX -1.3% @ 22.77, US T10 @ 0.925%
OIL Brent +0.6%, WTI +0.67% after EIA report but demand issues still a concern
Gold +0.8%, Silver +2.03%, Copper -0.3%
AHEAD Initial Jobless Claims, Continuing Claims, 4 Week Ave Jobless Claims, EIA Gas Stocks Change
DAX -0.31%, CAC -0.22%, FTSE -0.71% Markets opened flat and traded sideways but all sold down heavily into the close. FTSE had trended lower in the from late morning despite the news that the coronavirus vaccine developed by AstraZeneca and the University of Oxford for emergency use in the country and the MP’s approving the Brexit deal. Key being that Sterling continued to strengthen.EU/China trade deal in focus with European Commission President Ursula von der Leyen and European Council President Charles Michel scheduled to talk with Chinese President Xi.
Nationwide Housing Prices Dec +7.3% YoY vs +6.5% Nov (F/cast was +7.5%)
Nationwide Housing Prices Dec +0.8% MoM vs +0.9% Nov (F/cast was +0.7%)
EUROZONE No data due
GERMANY No data due
FRANCE No data due
UK No data due
JAPAN Market closed; ending at the highest since 1989.
Yen 103.22. Expectations are for further upside in 2021 due to vaccinations, improved business climate and accommodative policies.
No data due
Tokyo reported 944 new covid cases and the governor warned the outbreak could explode over the New Year holiday period and asked people to stay at home as much as possible. That is close to Saturday’s record of 949 cases and there are fears it could rise to over 1,000.
Honda says its Russian subsidiary would stop supplying new cars to official dealers in Russia in 2022 as part of the company's efforts to restructure its operations.
Regional Banks under pressure to restructure and embrace digitalisation under the government’s initiative.
Japan has drawn up an action plan to achieve its goal of boosting farm exports to 2 trillion yen by 2025, aiming to make products such as wagyu beef and sake more competitive in the global market. The action plan designates 27 key agricultural, fishery and forestry items, also including apples and other fruit as well as seafood such as yellowtail and scallops, and sets export targets to be achieved by that year. It identifies specific markets where demand for the key items is high, and calls for efforts to better serve their needs.
FT reports Fujitsu has drawn up a shortlist of 20 acquisition targets as part of a $5.8bn investment drive to capitalise on a pandemic-induced increase in demand for its digital services.
SOUTH KOREA Markets closed with Kospi ending on a new high with high expectations for the chip sector. Market re-opens Monday but an hour later than normal for the 2021 opening ceremony.
Inflation Rate Dec +0.5% YoY vs +0.6% Nov (F/cast was +0.6%)
Inflation Rate Dec +0.2% MoM vs -0.1% Nov (F/cast was +0.2%)
LG Group have signed a memorandum of understanding (MOU) on a $9.8 billion electric vehicle (EV) battery investment deal, the head of Indonesia's Investment Coordinating Board said on Wednesday. The agreement made Indonesia the first country in the world to integrate the electric battery industry from mining to producing electric car lithium batteries. +VE
Iraq agreed a $2.625 billion deal with Daewoo Engineering & Construction on Wednesday to build the first phase at its planned Faw commodities port in the south of the country. +VE
SAMSUNG concerns as prosecutors yesterday requested a nine-year prison term for Samsung Group chairman Jay Y. Lee, seeking to put the heir apparent back in jail in a bribery case that rocked the nation and ignited a backlash against its most powerful conglomerates.
Lotte Duty Free, is embracing contactless and smart shopping as the new normal for the duty-free industry. In an industry first, the company introduced a “smart store” that incorporates digital technologies and minimizes face-to-face contacts between shoppers and clerks. +VE
TAIWAN Expect market to open higher with Tech +VE but may also see logistics companies +VE after the PMI data from the CIER.
No data due
Taiwanese Central Epidemic Command Center reported the first confirmed case of coronavirus variant stemmed from the UK. The patient, now in a stable condition, returned to Taiwan with fever days ago. The government announced prohibition against all non-Taiwanese foreign visitor arrivals, effective Friday (1 January 2021), as part of its enhanced border control.
The official manufacturing PMI this month rose to 61.2, the sixth straight month of gains and the highest since March 2017 as business improved across sectors, the Chunghua Institution for Economic Research said yesterday, adding that it expects the momentum to continue over the next few months. Logistics service providers, such as shipping companies, were the biggest winners, with orders piling up through the second quarter of next year, it said.
The Legislative Yuan yesterday passed a series of measures aimed at curbing speculation on the real-estate market, including proposals to tighten oversight of pre-sold houses and increase public reporting requirements.
Oneness Biotech Co yesterday said it expects revenue to increase next year assuming its ON101 ointment is approved. Oneness, which has submitted an application for the treatment for diabetic foot ulcers to the Food and Drug Administration (FDA), said its phase 3 clinical trial showed that 62.2 percent of people who were treated with ON101 showed improvement.
CHINA Expect market to open higher on news of the EU/China agreement but the Pre Market PMI is important too.
Data due pre market
Manufacturing PMI Dec (Nov was 52.1 F/cast is 51.5)
Non Manufacturing PMI Dec (Nov was 56.4 F/cast is 56)
President Xi Jinping will deliver a New Year speech at 7:00 p.m. Thursday, state media Xinhua reports. It will be broadcast by major TV and radio channels of the China Media Group, and the websites and new media platforms of major state news organizations.
Northeastern Liaoning province reported five new coronavirus infections and four non symptomatic carriers, all local residents, on Tuesday, the provincial health commission said on Wednesday. The China Daily said that, of them, two confirmed patients and one asymptomatic patient are from Shenyang, the capital of the province. The rest are from the port city of Dalian.
Beijing reported seven locally confirmed new coronavirus infections on Tuesday, all of whom live in the capital's Shunyi district and are close contacts of previously reported virus patients, according to Beijing Municipal Health Commission.
The city of Wuhan in China's central Hubei province, has started the emergency use of vaccine candidates on certain key groups of people, the municipal government said Monday, the China Daily reports.
The European Union and China agreed on Wednesday to an investment deal that will give European companies greater access to Chinese markets and help redress what Europe sees as unbalanced economic ties.
China said Chinese companies will receive binding commitments of access to the EU market under a new investment agreement, while China will open up its financial, manufacturing and services sectors to the 27-nation bloc. Asked whether China would ratify outstanding labour conventions amid concerns in Europe about forced labour, Li said only that China forbids forced labour and has reiterated, in the agreement, its obligation as a member of the International Labour Organization (ILO). Beijing has not yet ratified four out of eight fundamental ILO conventions, including on forced labour, according to the organisation’s website.Reuters article with key points https://www.reuters.com/article/us-eu-china-trade-factbox/factbox-whats-and-whys-of-the-eu-china-investment-agreement-idUSKBN2941FA
China fines Tmall, JD and Vipshop for price irregularities in Beijing’s latest swipe at e-commerce giants. The fines of 500,000 yuan (US$77,000) each, the maximum for price irregularities, are Beijing’s latest move in disciplining the country’s e-commerce giants. -VE
Talks between India and China have yet to make headway to end a standoff on a disputed section of their Himalayan border, India's defence minister said on Wednesday, as thousands of troops from both sides faced a freezing winter in the mountains. -VE for sentiment
Ukraine has signed contract to buy 1.8 million doses of China’s Sinovac COVID-19 vaccine, the presidential office said on Wednesday, with the shots expected in “the shortest possible time” said Ukrainian authorities. +VE
George Gao Fu, director of the Chinese Centre for Disease Control and Prevention, said mRNA vaccines were being administered to healthy people for the first time and such a roll-out came with risks. “Western countries adopted the mRNA technology, which was developed for cancer patients,” state news agency Xinhua quoted Gao as saying on Tuesday. “I don’t know whether it will have side effects in the future, but the risk cannot be ruled out. -VE for sentiment.
Goldwind who is Xinjiang-based, has supplied material for a large US project that will deliver clean wind power for Microsoft, shipping records show. But as more information emerges about the suspected use of forced labour in the region, the US government has begun restricting trade from the area the company may become subject to restrictions. Slight -VE
HONG KONG ADR’s -154pts at 26,993 would indicate some consolidation after yesterday’s strong rally to a 10 month high but the EU/China deal may limit some of the downside. Key will be the Pre Market Chinese PMI data
No data due
SHORT SELLING Wednesday 16.7% vs 11.4% Tuesday
Top Shorts Bud Apac (1876) 50%, MTRC (66) 46%, Ping An (2318) 44%,Anta (2020) 39%, Henderson Land (12) 35%, BoC (3988) 33%, Country Garden (2007) 30%, Hang Seng Bank (11) 29%, Link Reit (823) 28%, Hengan (1044) 28%, AIA (1299) 26%, Wuxi Bio (2269) 26%.
HANG LUNG PPT (00101.HK) and HANG LUNG GROUP (00010.HK) jointly announced that the $2.566 billion acquisition of No.37 Shouson Hill Road had been delayed. Because of the ’status’ of the US Consulate and the fact they hadn’t got Chinese permission to sell the property. Little real impact although it may make some overseas investor more cautious.
Centa-Salesman Index (CSI) last printed at 50.08, +2.54 pts WoW said Centaline Property. The CSI received resilient support as it ran its course away from the trough of 43.34 as set in the third spike of plague. While the index indicated front-line agents' sentiment remained shaky, they did not turn bleak on the property market. They envisioned the CSI to trend more certainly with signals of subsiding epidemic.
SHOUGANG GRAND (00730.HK) announced that Beijing Jingxi Supply Chain Management Co., Ltd., a wholly owned subsidiary of the Company, entered into a strategic cooperation agreement with Jingdong Digits Technology Holding Co., Ltd. (JD Digits), under which the parties will carry out comprehensive cooperation in the field of supply chain business.
Beijing intends to undermine Jack Ma's power in his fintech empire and possibly increase stake in his business, Wall Street Journal cited Chinese central officials and government advisers. While Ant Group had announced the restructuring roadmap and plan to return to its root as online-payment platform, the more lucrative investment and loan businesses will be downsized.
Ten Hong Kong protesters captured at sea by Chinese officials while attempting to flee the city were sentenced to up to three years in jail in mainland China.