Wednesday, June 30, 2010

Economic data portends housing double−dip in Australia


Forex Special 

Asian Market Update: Economic data portends housing double-dip in Australia, Japan; Miners may receive super-profits tax compromise offer
As of 12amET: 
Nikkei225 -1.7%; earlier, falling over 2% to 2010 lows 
S&P/ASX -1.4% 
Kospi -1.0% 
Taiex -1.4% 
Shanghai Composite -1.7%; fell to 14-month low below 2,400 
US S&P Futures +0.4%; late-session strength 
Spot Gold testing $1,242/oz; range-bound $1,240-44 
Crude $75.90/brl; Backing away from 2-week lows 

Economic Data

- (UK) UK JUN GFK CONSUMER CONFIDENCE SURVEY: -19 V -20E (6-month low)
- (AU) AUSTRALIA MAY HIA NEW HOME SALES M/M: -6.4% V 6.2% PRIOR (biggest decline since Jul 2008) 
- (AU) AUSTRALIA JUN DEWR SKILLED VACANCIES M/M: -0.3% V 0.0% PRIOR (first decline since Jun 2009) - (AU) AUSTRALIA MAY PRIVATE SECTOR CREDIT M/M: 0.5% V 0.4%E; Y/Y: 2.7% V 2.4%E (10-month high) 
- (SI) SINGAPORE MAY M1 MONEY SUPPLY Y/Y: 22.3% V 17.3% PRIOR; M2 Y/Y: 9.0% V 9.0% PRIOR 
- (JP) JAPAN JUN NOMURA/JMMA MANUFACTURING PMI: 53.9 V 54.7 PRIOR (first decline in 3 months) 
- (JP) JAPAN MAY LABOR CASH EARNINGS Y/Y: -0.2% V 0.8%E (3-month low) 
- (JP) JAPAN MAY HOUSING STARTS Y/Y: -4.6% V +5.0%E (3-month low); ANNUALIZED HOUSING STARTS: 737K V 810KE; CONSTRUCTION ORDERS Y/Y: +9.2% V -25.0% PRIOR; (double-dip in Japan housing - Decline follows single month of increase in April - first since Oct 2008)
- (KS) SOUTH KOREA MAY INDUSTRIAL PRODUCTION M/M: 2.6% V 0.6%E (3-month high); Y/Y: 21.5% V 20.8%E 
- (KS) SOUTH KOREA MAY LEADING INDEX Y/Y: 8.0% V 8.6% PRIOR 
- (KS) SOUTH KOREA JUL BUSINESS SURVEY MANUFACTURING: 104 V 104 PRIOR; NON-MANUF: 87 V 90 PRIOR (5-month low)

Top Headlines

- Australian govt endorses a compromise plan on mining tax and has presented its proposal to the industry - Australian Financial Review; Separate report in The Australian stating FMG.AU CEO Forrest has held talks with former PM Rudd about modifying resource tax provision, pushed for thethreshold to rise to as much as 15%, and would like to see the new cabinet improve on some of the aspects of proposal 
- Australia PM Gillard response: Constructive talks with mining industry continue 
- RBNZ Gov Bollard: To continue unwinding stimulus policy; Price stability remains central bank's objective

Forex

- PBoC sets yuan mid point at 6.7909 v 6.7977 prior close (second consecutive weaker yuan setting) 
- RBA injects A$1.7B into money markets v A$132M system deficit (money markets in disarray, even outside Europe) 
- According to an Ipsos survey, about 51% of German voters would prefer to return to the deutschmark - press 

Financials

- NBG: Rejects press speculation of talks with Qatar Investment Authority; not seeking to raise capital 
- AXA.AU: NAB may require second extension from Australia regulators for purchase of Axa Asia unit 
- Shinsei Bank: To provide around ¥20B over the next three years for a new unit specializing in small-business turnaround lending - Japanese press 

Energy 

- API PETROLEUM INVENTORIES: CRUDE: -3.4M V -1ME (bullish); GASOLINE: -910K V -500KE 
- APC: Company may have been aware of key operational decisions at the exploded Macondo well - FT 
- China National Energy Administration: Should promote M&A in coal industry 
- Santos: Australian press sees continued interest in the company assets by China's Sinopec - Mitsubishi Corp enters natural gas project in Iraq with Royal Dutch Shell; total investment expected at ¥1T -Japanese Press

Healthcare

- Takeda: To forego share buybacks this FY for second consecutive year; Use cash for R&D - Japanese press 

Industrials/Materials

- 1618.HK - Metallurgical Corporation of China: 2010 sales growth rate to exceed that of 2009
- 028050.KS - Samsung Engineering: Wins a $930M order from UAE's Abu Dhabi Polymer Company 
- Toyota: House committee asks for more documents from Toyota on break override system 

Technology

- Chi Mei Optoelectronics: Capex to rise to NT$100B (same as last year) 
- Panasonic: Plans to increase electronic component sales to ¥470B in FY12 up 28% from FY09 -Japanese press 
- Konica Minolta: May post Q1 Op profit ¥11B v loss ¥0.5B y/y 

Speakers/Geopolitical

- China Premier Wen: China needs continuity and stability in economic policies; Need to continue to manage inflation expectations, keep policy flexibility 
- South Korea Fin Ministry: Economy to continue recovery on strong external demand, improving employment 
- Taiwan may sign a free trade agreement with at least one other Southeast Asia nation (after signing cross-straits agreement with China overnight) 
- Australian press speculating on Aug 28th or Oct 10th as the likely dates for national elections

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