Asia Roundup: Dollar Edges Higher, Asian Stocks Hit 1-Month Lows on Fed, Global Growth Concerns- Tuesday, November 10th,

Market Roundup

• Japan Sept current account surplus trln, expected, Sept Y978 bln.
• MoF Oct flow data – Japanese bought net Y993.2 bln foreign stocks, trln bonds, volume massive, mostly US Treasuries, sold Y173.0 bln bills;  foreign investors bought net trln Japanese stocks, trln bonds, trln bills.
• Japan Oct outstanding bank loans +2.5% y/y at trln, Sept +2.6%.
• China ViceFinMin Zhu – Can achieve growth target of 7% this year.
• China pledges comprehensive reforms, sees CNY as international currency by ’20.
• China Oct CPI +1.3% y/y, PPI -5.9%, +1.5% and -5.8% expected.
• UK Oct BRC like-for-like retail sales -0.2% y/y, Sept +2.6%, total retail sales +0.9%, weakest October reading since ’08, Sept +3.9%.
• Australia Oct NAB business conditions index +9, confidence +2, last +9, +5, data still strong, sales-profits-employment all positive.
• Australia Sept owner-occupied housing finance +2.0% m/m, investment housing finance -8.5%, Aug revised +1.5%, -0.1%.
• NZ Oct electronic card retail sales unchanged m/m, +5.6% y/y, Sept +0.9%, +1.2%.
• NZ Oct REINZ house price index -5.5% m/m, sales -5.1%.

Economic Data Ahead

• 06:45 Swiss Oct unemployment, 3.3% nsa, 3.4% sa expected; last 3.2%, 3.4%.
• 07:45 France Sep industrial output, unch m/m, +2.0% y/y expected; last +1.6%, +1.6%.
• 09:00 Italy Sep industrial output, +0.5% m/m, +1.8% y/y expected; last -0.5%, +1.0%.
• 09:00 Norway Oct CPI, +0.2% m/m, +2.2% y/y expected; last +0.6%, +2.1%.
• 09:00 Norway Oct – core, +0.2% m/m, +3.1% y/y expected; last +0.8%, +3.1%.
• 09:00 Norway Oct PPI; last -10.1% y/y.|
• 11:00 US Oct NFIB business optimism index; last 96.1.
• 13:30 US Oct export, import prices, -0.2%, -0.1% m/m eyed; last -0.7%, -0.1%.
• 15:00 US Sep wholesale inventories, sales, unch, +0.1% m/m eyed; last +0.1%, -1.0%.

Key Events Ahead, Auctions (GMT)

• EcoFin meeting, ECB Pres Draghi exchange with EU parliament in general elections.
• Belgium E1.6-2 bln each 3 and 12-month treasury certificate auctions.
• 08:15 ECB Nouy speech in Frankfurt.
• 08:30 Riksbank October meeting minutes.
• 09:00 Netherlands E2-3 bln zero% 2018 DSL auction.
• 09:30 ECB 7-day refi at fixed 0.05%, E60 bln allotment eyed, last bln.
• 10:00 ECB/Buba Weidmann speech in Frankfurt.
• 10:00 ECB/Finland CB Liikanen parliamentary testimony on ECB policy.
• 10:30 UK DMO GBP700 mln 0.125% 2058 index-linked Gilt auction.
• 10:30 Germany E1 bln 0.5% 2030 index-linked Bund auction.
• 11:15 ECB Coeure at Berlin French-German Business Forum.
• 17:00 BoC DepGov Wilkins speech in Toronto.
• 17:30 BoE DepGov Cunliffe speech in Geneva.
• 19:30 Chicago Fed Evans speech in Chicago.
• 20:00 RBNZ Financial Stability Report, Gov Wheeler press conference.

Equity RecapAsian shares dropped to one-month lows on Tuesday as the spectre of higher borrowing costs in the US and slower global economic growth haunted riskier assets.Japan’s Nikkei fell 0.3 percent from a 2 1/2-month high hit on Monday, though it managed to trim earlier losses.MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1 percent. South Korea’s Kospi fell 1.6 percent and Hong Kong’s Hang Seng shed 1.2 percent. Taiwan stocks closed down 1.2 pct at 8,536.90 points.Shanghai stocks pared earlier losses and were last up 0.4 percent, led by financials that shored up last week’s rally.Treasuries RecapThe two-year US Treasuries yield stood at 0.870 percent on Tuesday, it hit 5-1/2-year high of 0.958 percent on Friday.Canadian government bond prices were mixed across the maturity curve, with the 2-year price up 1 Canadian cent to yield 0.672 percent and the benchmark 10-year falling 9 Canadian cents to yield 1.725 percent. The Canada-U.S. two-year bond spread was -21.8 basis points, while the 10-year spread was -62.8 basis points.New Zealand government bonds dropped in line with U.S. Treasuries, sending yields as much as 8 basis points higher. Australian government bond futures edged up from 3-month lows, with the 3-year bond contract up 1 tick at 97.950. The 10-year contract also added 1 tick to 97.0750, while the 20-year contract gained 2 ticks to 96.5450.Commodities RecapOil prices climbed on Tuesday after the head of OPEC forecast a more balanced market next year and the U.S. energy department said domestic output is likely to fall further, though gains were limited as the overall picture of a market in glut remains. U.S. crude rose 28 cents to $44.06 a barrel by 0409 GMT, after falling about 1 percent on Monday to $44.15 for a fourth consecutive decline. Brent crude was up 21 cents at $47.40 a barrel. Gold was near a three-month low on Tuesday on expectations the U.S. Fed was well on track to raise interest rates before the end of the year. Spot gold was little changed at $1,092.60 an ounce by 0241 GMT. FX Beat USD: The dollar moved back toward a 7-month peak against a basket of major currencies on Tuesday, strengthened by rising expectations that the U.S. Fed is on track to raise interest rates next month. It added about 0.1 percent to 99.035, moving back toward Friday’s peak of 99.345, a high not seen since mid-April. Against the yen, the dollar was trading at 123.16 yen, steady on the day and not far from the previous session’s 2-1/2-month high of  123.60. EUR/USD: The euro traded at $1.0746, down about 1 percent and moving back towards Friday’s low of $1.0704. Against the yen, the common currency stood at 132.20 yen, drifting off a 6-month low of 131.45 plunged overnight. Still, the euro remains vulnerable as Portuguese government bond yields hit a 4-month high and shares dropped after leftist parties reached agreement on forming an alternative government to try to oust the centre-right.USD/JPY: The JPY complex was steady in Asia, it was trading in 123.03-26 range, Japan’s current account surplus came in at trn in September (consensus: trn); the data revealed that Japanese investors bought the most US Treasuries in five years. EUR/JPY was trading in soggy range 32.36-49, GBP/JPY was trading in between 185.94-186.32. USD2.4 bln option expiries anchor.USD/CNY: China’s yuan firmed slightly against the dollar though the PBOC set a weaker official midpoint for the sixth consecutive day. The spot market opened at 6.3620 per dollar and was changing hands at 6.3589 near midday, 33 pips stronger than the previous close and 0.02 percent firmer than the midpoint. Offshore yuan was trading 0.47 percent weaker than the onshore spot rate at 6.3887 per dollar. AUD/USD: The Australian and New Zealand dollars were off one-month lows on Tuesday, but remained vulnerable to expectations that the US Fed will raise interest rates in December. The Aussie held at $0.7045, from a trough of $0.7016 on Monday. It shed 1.3 percent last week, largely due to upbeat U.S. jobs data which stoked speculation of a Fed rate hike. Key support is found at $0.7008, the 76.4 percent retracement of the  $0.6892-$0.7382 climb in September and October. The New Zealand dollar stumbled at $0.6528, having dipped just below 65 cents last week. GBP/USD: Sterling steadied just above $1.51 on Monday and gained around a third of a percent against the euro, it was up 0.4 percent on the day at $1.5118, almost all of that gain coming in the last hour of trade in London. That was still within sight of Friday’s more than six-month low of $1.5027. Against the euro, the pound was 0.3 percent stronger at 71.20 pence. USD/CAD: The Canadian dollar posted a modest bounce against the U.S. dollar on Monday, as the greenback paused after recent gains in the face of fresh concern about the global growth outlook. It ended at C$1.3275 to the greenback, or 75.33 U.S. cents. That was stronger than Friday’s close of C$1.3296, or 75.21 U.S. cents.

The material has been provided by InstaForex Company – www.instaforex.com