Aussie Energy Index Drops Over 5% As WTI Crude Futures Trade At Lowest Level Since 1999

General Trend:

  • Aussie refiner Caltex noted merger with Canadian firm will not proceed, cited coronavirus impact
  • Decliners in Japan include Real Estate and Retail firms
  • Shanghai Composite rises by less than 0.5% during morning session; Telecom Services firms rise as China pledged to accelerate investment related to 5G
  • Shanghai Stock Exchange to examine volatility related to large cap health care index
  • Chinese airlines report over 70% declines in March passenger traffic
  • Chinese iron ore futures rise amid cut in Vale’s production guidance
  • PBOC cuts loan prime rates (LPRs) as expected
  • New Zealand Q1 CPI rose to the highest level since 2011, data impacted by higher cigarette prices and rents
  • NZD rises as PM announced plan to ease lockdown
  • RBA again cuts daily bond purchases under QE program
  • US Treasury Dept confirms 90-day deferral of certain tariff payments, move aimed at providing relief to US companies
  • Japan’s March exports to the US declined at the sharpest rate since 2011
  • US President Trump: Expects help for hotels to be discussed

Headlines/Economic Data

Australia/New Zealand

  • ASX 200 opened -0.0%
  • (NZ) NEW ZEALAND Q1 CPI Q/Q: 0.8% V 0.4%E; Y/Y: 2.5% (Highest since Sept 2011) V 2.1%E
  • S32.AU Reports Q3 manganese production 1.31Mt v M y/y; alumina 1.28Mt v 1.20Mt y/y; suspends share buyback program
  • (AU) Reserve Bank of Australia (RBA): Excess cash at exchange settlement (ES) accounts at A$85.8B v A$87.3B prior
  • (AU) Reserve Bank of Australia (RBA) adds A$1.35B to banking system through repos v A$1.52B prior
  • (NZ) Reserve Bank of New Zealand (RBNZ) buys NZ$450M in gov’t bonds v NZ$450M sought as part of QE operations v NZ$600M prior
  • (AU) Australia sells A$3B v A$3.0B indicated in 2.25% Nov 2022 bonds, avg yield 0.2544%, bid to cover 4.19x
  • (AU) Reserve Bank of Australia (RBA) Gov Lowe: Australia shouldn’t be concerned about its escalating govt debt in response to the coronavirus crisis because of the long record of responsible fiscal policy, if ever there was a time for individuals to borrow it is now
  • (AU) Reserve Bank of Australia (RBA) offers to buy total of A$500M in bonds v A$750M prior; Offers to buy Apr-Nov 2029 bonds
  • (AU) Australia Treasurer Frydenberg: RBA yield curve control is working well
  • (NZ) New Zealand Q1 RBNZ Sectoral Factor Model Inflation Index y/y: 1.7% v 1.8% prior; Sectoral Factor Model Non-Tradable Core Y/Y: 2.7% v 2.8% prior
  • (NZ) New Zealand PM Ardern: New Zealand will move out of lockdown in 1-week, Apr 27th; Virus transmission rate is now 0.48%; New Zealand has one of the lowest mortality rate in the world

Japan

  • Nikkei 225 opened -1.0%
  • (JP) Japan Cabinet approval rating -2ppt to 41%; Disapproval rating +4ppt to 42% (1st time disapproval rating is above approval rating in 13-months) – Mainichi
  • (JP) According to draft, Japan Govt Revises Stimulus package to ¥117.1T from ¥108.2T, Extra Budget revised to ¥25.6T from ¥16.8T; to raise issuance of JGBs by more than ¥5T to ¥152-153T, extra bond sales to fund stimulus – press
  • (JP) Japan Foreign Min Motegi: Cabinet to decide on extra budget this afternoon
  • (JP) Japan Mar Trade Balance: ¥4.9B v ¥459.9Be; Adj Trade Balance: -¥190.0B v -¥115.0Be; Exports y/y: -11.7% v -9.4%e; Imports y/y: -5.0% v -8.7%e; Exports to China -8.7%; US -16.5% y/y, EU -11.1% y/y
  • (JP) Japan Securities Dealers Association (JSDA): In March global funds sold record levels of 10-year JGBS

Korea

  • Kospi opened -0.3%
  • (KR) South Korea Govt: To maintain social distancing guidelines with less intensity until May 5th – Yonhap
  • 020560.KR Announces self rescue plan: Extends unpaid leave for employees, implementing measures to safeguard operations until they return to more normal
  • (KR) South Korea reports people who tested positive again for COVID-19 after making full recoveries at 179 (2.2% of those who have recovered from the coronavirus)
  • (KR) South Korea Govt Expected to announce next steps for Airlines and Refineries during this week – Yonhap
  • (KR) Bank of Korea (BOK) sells 6-month Monetary Stabilization Bonds (MSB); avg yield 0.70% v 0.65% prior
  • (KR) South Korea sells 20-year Treasury Bonds; avg yield 1.55% v 1.795% prior

China/Hong Kong

  • Hang Seng opened +0.5%; Shanghai Composite opened +0.1%
  • (CN) CHINA SETS 1-YEAR LOAN PRIME RATE (LPR) AT 3.85% V 4.05% PRIOR (3.85%E); SETS 5-YEAR LPR AT 4.65% V 4.75% PRIOR (4.65%E)
  • (CN) China Politburo: Need to be more proactive with fiscal policies, like using special govt bondst and increasing the issuance of local govt; monetary policy should be more flexible and balanced and instruments such as RRR cuts, interest rate reductions and reloans should be fully leveraged – Xinhua
  • (CN) China National Health Commission Coronavirus Update for April 19th: 12 additional cases (8 imported) v 27 prior; Additional deaths: 0 v 0 prior; Additional Asymptomatic cases 49 v 54 prior
  • (CN) China PBoC Open Market Operation (OMO): Skips Reserve Repo Operations for the 13th consecutive session; Net CNY0B v CNY0B prior
  • (CN) China PBOC sets Yuan reference rate: 7.0657 v 7.0718 prior
  • (CN) China NDRC: To roll out more forceful and targeted fiscal, financial and employment policies with relevant departments; China still has ‘very large room’ for macro hedging policy to work with; CPI will continue to decline
  • (CN) China Finance Ministry Official: China will appropriately increase Budget Deficit ratio; Pressure on local govt to safeguard operations and wages will ease as economy and revenues improve; To sell additional CNY1.0T in local govt special bonds in near term

North America

  • (US) Pres Trump: the coronavirus surge seems to be over; some states have been too tough regarding stay at home orders; states could get the same results by doing less – Friday evening press conf
  • (US) Congress democrats and Administration close to $450B economic relief package for small business, include billions for the Paycheck Protection Program (PPP), hospitals and expansion for more testing – financial press
  • (US) Follow Up: House Maj Leader Hoyer (D-MD):House could meet Wednesday on relief loan plan
  • (US) Treasury Sec Mnuchin and House Speaker Pelosi said to be “very close” to a deal for second round of small business loans – CNBC tweet
  • (US) Banks asked the Fed to change terms of Main Street Lending Program, saying minimum of $1.0M loan is too large for most companies, should be reduced to $50-100K minimum loan amount – press
  • BA Germany expected to announce order for 45 fighter aircrafts, to replace Tornado jets – German press
  • (US) US Treasury announces 90-day deferral of some tariff payments, does not apply to anti-dumping and countervailing duties; does not apply to section 201, 232, 301 trade remedies

Europe

  • (UK) Apr Rightmove House Prices M/M: -0.2% v +1.0% prior; Y/Y: 2.1% v 3.5% prior
  • (ES) Spain Govt authorizes drones to be used to disinfect different types of facilities for coronavirus via “aerial procedures” like fogging – Spanish press

Levels as of 1:15ET

  • Hang Seng -0.2%; Shanghai Composite +0.3%; Kospi -0.3%; Nikkei225 -1.2%; ASX 200 -1.2%
  • Equity Futures: S&P500 -0.2%; Nasdaq100 -0.1%, Dax +0.2%; FTSE100 -0.1%
  • EUR 1.0878-1.0857; JPY 107.89-107.50; AUD 0.6367-0.6336; NZD 0.6060-0.6009
  • Commodity Futures: Gold -0.1% at $1,696/oz; Crude Oil -5.4% at $23.68/brl; Copper +0.1% at $2.35/lb


Sandra Z. Connelly

Sandra Z. Connelly

Sandra Z. Connelly leads is leading the DAY TO DAY & WORLD NEWS column. She has mastered the art of writing since her childhood, and with time, this has developed to be an enormous talent. When we hired her, we were definite that her skill sets would benefit our website, and gladly, we were right. Not only she has shown skills in writing, but she has also demonstrated her ability to manage time according to her work schedule.

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