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Commentary: January ends with a busy day for news
00:00, 30 January 2014
This has been an unusual week for Asia Pacific trading with Australia and New Zealand closed Monday for Australia Day and China and Singapore closed today for Lunar New Year. The main focus is on Japan where the usual monthly basket of major releases is due but there are also a couple of smaller releases from Australia and New Zealand that could have an impact as well. NZD continued to be hit hard overnight as traders who had been speculating on an immediate RBNZ interest rate increase scrambled to get back on side as they try to figure out how soon “soon” might be. With the exception of the Kiwi Dollar, risk trades have been back on today. It appears that traders have recognized that continued Fed tapering can be seen as a sign of strength. Meanwhile, better than expected Brazilian employment data helped to dispel some of the concerns about emerging markets or at least focus the fear on the most troubled countries rather than painting everyone with the same brush. Renewed confidence has sent the Dow to a 100 point rebound and could take some of the pressure off of the Asia Pacific markets that are open today. Defensive havens like gold, silver, JPY and CHF have come under pressure instead as capital moves back out. Commodity markets have been mixed today with WTI rallying on the potential for increased demand in the US, copper slumping on concerns about China after HSBC PMI came in under 50 and Natural gas retreating back toward $5.00 as a break in the cold snap had traders starting to look past heating season. Even without all of this news, we have the potential to be an active day for trading as traders adjust positions for month end and set up for next week which includes global PMI reports and another big US employment report. There are also a number of releases scheduled in Europe and North America that could keep the pot boiling right through to the close. Corporate News It’s a busy afternoon for technology earnings with reports due from Google and Amazon. Economic News Significant announcements released overnight include: US Q4 GDP 3.2% as expected vs previous 4.1% US Q4 PCE inflation 1.1% as expected vs previous 1.4% US pending home sales (6.1%) vs street (0.3%) US natural gas storage (230 BCF) vs street (233 BCF) Brazil unemployment rate 4.3% vs street 4.4% vs previous 4.6% Spain GDP (0.1%) as expected vs previous (1.1%) Germany unemployment chnge (28K) vs street (5K) Germany unemployment rate 6.8% vs street 6.9% Germany consumer prices 1.3% vs street 1.5% UK mortgage approvals 71K vs street 72K Upcoming significant announcements include: 8:45 am AEDT NZ trade balance street $500M 10:15 am AEDT Japan manufacturing PMI previous 55.2 10:30 am AEDT Japan unemployment rate street 3.9% 10:30 am AEDT Japan consumer prices street 1.5% 10:50 am AEDT Japan industrial production street 7.3% 11:30 am AEDT Australia producer prices street 1.9% 4:00 pm AEDT Japan housing starts street 13.6% 4:00pm AEDT Japan construction orders street 2.2% 7:00 am GMT Germany retail sales street 1.9% 7:45 am GMT France consumer spending street 0.9% 8:00 am GMT Spain consumer prices street 0.3% 9:00 am GMT Italy unemployment rate street 12.8% 10:00 am GMT Greece retail sales previous (1.9%) 10:00 am GMT Eurozone unemployment rate street 12.1% 10:00 am GMT Eurozone consumer prices street 0.9% 12:00 pm GMT India GDP previous 6.2% 8:30 am EST Canada GDP street 2.6% 8:30 am EST US personal income street 0.2% 8:30 am EST US personal spending street 0.2% 8:30 am EST US PCE core inflation street 1.2% 9:45 am EST US Chicago PMI street 59.0 9:55 am EST US Michigan consumer cnfdnce street 81.0 8:00 pm EST China manufacturing PMI street 50.5 vs previous 51.0