Morning Report APAC: Peso, Asian stocks boom in early trade
- Asian stocks, US stock index futures gain on FBI "Clinton information"
- Mexican Peso climbs the most since September on Clinton news
- The peso climbed 2.3% versus the dollar in early Asian trade
- JPY sinks by the most in a month but MSCI Asia rebounds most in a month
- Nonfarm payrolls added 161,000 jobs in October, though below expectations
By Saxo APAC Sales Trading
Economic data of the day (Singapore Time)
- 18:45 – GBP – BOE official Alex Brazier speaks in Brussels
- 22:00 – EUR – ECB’s Sabine Lautenschlaeger speaks in Munich
US Elections: FBI Director James Comey - who shook up the race days ago after reopening the Hillary Clinton e-mail inquiry - sent a letter to Congress saying the bureau hasn't changed its conclusions from July.
It declared she hadn't committed a crime with her private server. You can watch the latest polls here
US: Nonfarm payrolls increased 161,000 in October (expected 173,000) from an upwardly revised increase of 191,000 in September from 156,000.
Job gains were broad across most sectors - professional and business services payrolls rose 43,000, healthcare and social assistance employment rose 39,100.
Temporary help jobs rose 6,400 and government employment rose 19,000 - although employment did decline in manufacturing, retail trade, and mining and logging.
The unemployment rate stayed at 4.9% as expected.
Federal Reserve speech: Fed vice chairman Stanley Fischer said the US labour market is close to full strength and the economy could at some point overshoot the Federal Reserve's goals for employment and inflation.
The USD managed to rally slightly on the back of the back of FBI confirming that it didn’t change the conclusions of the previous investigations. Not much reaction of the USD following the NFP on Friday.
GBPUSD continue to break higher on stops but is now finding good selling interest closer to 1.2500. EURGBP has a strong resistance just above 0.9000 and we believe there is much more room to move lower.
USDJPY bounced off the support of the 100 Day Moving Average after the FBI comments and the rate hike in December from the Fed being confirmed after the latest NFP numbers, we should find some good support in the pair.
In emerging markets, USDMXN was the main mover following the FBI comments and trades again close to the strong support of the 200d MA at 18.41.
Unfortunately, many had that idea but got stopped out last week after the latest polls gave Trump closer than initially thought. The risk reward at this level is on the long side with a stop below the 200 DMA.
Foreign exchange movements
USDJPY vols are fairly bid this morning following the move in spot. The US elections should give more support to the spot in Clinton wins.
USDMXN vols are still bid close to the highs but should selloff following the strong move lower in spot this morning.
Benchmark German 10-year bund yields dropped three basis points last week to 0.135%.
The yield difference between German and Italian 10-year bonds approached the widest in 2016 this week as investors sought the region’s safest assets, ahead of the US presidential election next week and Italy’s constitutional referendum in December.
The S&P 500 lost ground late in Friday’s session to register its ninth consecutive decline. This is the longest losing streak since 1980, as markets become more cautious as US election draw nearer.
The S&P 500 edged down another 3.48 points to 2,085.18, with staples down 1% and led the losers.
Berkshire Hathaway declined 0.2% after it reported Q3 operating profit rose less than estimation, even though revenue crept higher than estimation driven by its businesses in manufacturing, utilities and energy.
European stocks registered further loss on Friday to log their deepest weekly decline in nine months. The Stoxx Europe 600 index fell 0.8% to 328.80. In London the FTSE 100 sank 97.25 points, or 1.4%, to 6,693.26 - a seven-week low.
Luxury goods group Financière Richemont jumped 5.2% after it announced a management shake-up after a decline in H1 net profit was reported.
British Airways parent International Consolidated Airlines Group dived 3.6% after it lowered its medium-term EBITDA guidance as it adjusts to slide in sterling post Brexit.
- Samsonite (1910 HK): Reinstated at neutral at Goldman
- ABC (1288) is fined US$215M for violating NY's Anti-Money Laundering Laws
- HK Ppty: Existing home price -0.28% WoW (Centaline)… 34 tenders received for 2 residential sites at Lo Fai Road, Tai Po
- CICC(3908) to acquite CISC for RMB16.7b by issuing shares at HK$11.55/shr, representing a 0.6% discount to the closing price before trade suspension.
- GAC Group(2238) Oct overall car production +15.44%YoY To 136,000 units; sales +35.36% YoY To 158,100 units.
- HKEX(388) Jan.-Oct. security market average daily turnover -41% YoY while fund raised through IPOs -17% YoY
- Sunac(1918) Oct contracted sales +85.77% Yoy To RMB15.01B
- Yashili (1230) signed supply agreement with Danone
- GF Sec(1776) Oct net profit -14.2% Mom To RMB425m
- Haitong Sec (6837) Oct net profit amounted to RMB476m
- Citic Sec (6030) Oct net profit amounted to RMB736m
- CMSC (6099) Oct net profit +73% Yoy To RMB460m
- Ch Inv Fin Gp (1226) interim loss widened to HK$59.5m vs HK$44.58m last year
- Man Wah Hldgs (1999) Issued A Positive Profit Alert, Expects Interim Gains +40% YoY
- SH Pharma(2607) clarifies reports on insider trading and confirmed that none of the senior management involved in the investigation held by Australian Securities And Investments Commission
- Evergrande (3333) Oct contracted sales +40.1% YoY to RMB36.13b
- China Cosco(1919)'s subsidiary sells 100% stake in Chongqing COSCO Chemical Logistics
- China South City (1668) wins bid for Zhengzhou land at RMB1.57B
- SH Electric (2727) receives assets injection from controlling shareholder
- Shui On Land(272) Oct contracted sales -57% YoY to RMB1.1B
- ICBC(1398) to raise funds for new 16+1 financial co which is a group including China and countries of eastern and central Europe
- China Vanguard (8156) Issued A profit warning, expects 1Q loss to widen
- Sunshine 100(2608) Jan-Oct Contracted Sales +36.4% Yoy To RMB7.39B
- Gemdale Ppty (535) Jan-Oct Contracted Sales +103% Yoy To RMB 15.9B
- Modern Land (1107) Oct contracted sales -30.14% Yoy to RMB1.09B
- Asahi Holdings (5857 JP): Raised to buy from neutral at Ichiyoshi Research
- Denso (6902 JP): Cut to neutral from outperform at Daiwa
- Fanuc (6954 JP): Raised to hold at BNP Paribas
- Kotobuki Spirits (2222 JP): Raised to buy from outperform at Daiwa
- MS&AD (8725 JP): Rated new buy at Haitong
- Nippon Steel (5401 JP): Raised to neutral plus from neutral at Iwai Cosmo Securities
- SPK (7466 JP): Rated new neutral plus at Iwai Cosmo Securities
- Suzuki Motor (7269 JP): Raised to buy at Nomura
- Taiyo Holdings (4626 JP): Raised to buy at Ichiyoshi Research
- Tokio Marine (8766 JP): Rated new buy at Haitong
- Toyota to Mass-Produce Electric Vehicles: Nikkei
- Takata Said to Hope to Reach Deal by Year-End: WSJ
- Sony Sued in China for Patent Infringement: FT
- Mitsui in Talks to Build Asian Wind Farms: Nikkei
- Terumo 1H Operating Profit Seen About 40b Yen: Nikkei
- Toyo Ink 1H Profit Seen Climbing 5%: Nikkei
- Secom Seen Posting Record 1H Profit: Nikkei
- Japan to Pitch Bullet Trains For India Project: Nikkei
- India to Buy 12 Amphibious Aircraft From Shinmaywa: Nikkei
- SBI Holdings Sets Up Islamic Fund for Southeast Asia: Nikkei
- Farm Co-Op to Buy 90% Stake in SFG Holdings: Nikkei
- Sonic Healthcare raised to overweight vs equalweight: Morgan Stanley
- Orica cut to underperform at RBC Capital
- Sonic Healthcare raised to neutral at Credit Suisse
- Inghams to start trading on ASX
- Trustpower 1H earnings
- UGL annual meeting
Source: CIMB / Bloomberg
– Edited by Adam Courtenay
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