Article / 07 November 2016 at 1:38 GMT

Morning Report APAC: Peso, Asian stocks boom in early trade

APAC Sales Trading Desk / Saxo Capital Markets
Singapore

 

  • 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)
xxx

 

Speeches
-       18:45 – GBP – BOE official Alex Brazier speaks in Brussels
-       22:00 – EUR – ECB’s Sabine Lautenschlaeger speaks in Munich

Overnight news

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.


Foreign exchange

xxx

 














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

xxx

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.

Rates
xxx

Fresh signs of wage inflation and on-target job data in US didn't manage to slow down the run for rates markets due to safe haven buying ahead of election. The Two-year note yield dropped 2.2bps to 0.784%. The 10-year bond yield fell 3.5bps to 1.776%.
 
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.

Commodities 

xxx





Equities

xxx

 












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.
 

Asia-Pacific stocks

Hong Kong
 
Analyst ratings

-       Samsonite (1910 HK): Reinstated at neutral at Goldman
Preview:
-       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
 
Japan

 
Analyst ratings:
-       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
Preview:
-       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


Australia
 
Analyst ratings:
-       Sonic Healthcare raised to overweight vs equalweight: Morgan Stanley
-       Orica cut to underperform at RBC Capital
-       Sonic Healthcare raised to neutral at Credit Suisse

Preview
-       Inghams to start trading on ASX
-       Trustpower 1H earnings
-       UGL annual meeting

Source: CIMB / Bloomberg

xxx
 US jobs are being created although not in manufacturing and retail trade. Photo: iStock

 
– Edited by Adam Courtenay


This report was compiled by the Saxo APAC Sales trading team in Singapore – the home of social trading. Follow the team on @SaxoStrats or post your comment below to engage with Saxo Bank's social trading platform. Follow us on @SaxoStrats on Twitter

All material contained herein is provided for your general information. The information and commentaries are not intended to be and do not constitute financial advice, investment advice, trading advice or any other advice or recommendation of any sort offered or endorsed by Saxo Capital Markets Pte. Ltd. (“SCM SG”). Any expression of opinion (which may be subject to change without notice) is personal to the presenter and/or author; they do not reflect the view or opinion of SCM SG or its affiliates, neither do they constitute an endorsement of SCM SG’s view or analysis of the same.

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments. SCM SG does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment based on any commentaries or information provided here.
For further information, please click here.  


Saxo Capital Markets Pte Ltd ("Saxo Capital Markets") is a licensed subsidiary of Saxo Bank A/S, an online trading and investment specialist. Saxo Capital Markets serves as the APAC headquarters and holds a capital markets services licence under the Monetary Authority of Singapore; and a commodity broker licence issued by the International Enterprise Singapore. Clients can trade Forex, CFDs, Stocks, Futures, Options and other derivatives via SaxoWebTrader and SaxoTrader, the leading multi-asset online trading platforms.
Trading risks are magnified by leverage - losses can exceed your deposits. Trade only after you have acknowledged and accepted the risks. You should carefully consider whether trading in leveraged products is appropriate for you based on your financial circumstances. Please consider our Risk Warning and General Business Terms before trading with us. Please see full General Disclaimer.

Thousands of serious traders receive free news and analysis from Saxo Capital Markets each day. Saxo Capital Markets never sends these emails unsolicited; they are sent following acceptance of your membership and subscription request by Saxo Capital Markets at saxomarkets.com.sg. If you do not wish to receive any emails from Saxo Capital Markets in the future, please reply to this email with the word "UNSUBSCRIBE" in the subject header.

Copyright | Disclaimer | Risk Warning | Privacy Policy | Contact Us
Samsung Hub | 3 Church Street | # 30-01 | Singapore 049483
Company No. 200601141M

Disclaimer

The Saxo Bank Group entities each provide execution-only service and access to Tradingfloor.com permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Tradingfloor.com and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Tradingfloor.com is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Tradingfloor.com or as a result of the use of the Tradingfloor.com. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. When trading through Tradingfloor.com your contracting Saxo Bank Group entity will be the counterparty to any trading entered into by you. Tradingfloor.com does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of ourtrading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws. Please read our disclaimers:
- Notification on Non-Independent Invetment Research
- Full disclaimer

Check your inbox for a mail from us to fully activate your profile. No mail? Have us re-send your verification mail