Today’s Chinese GDP report could have a particularly significant impact on trading today. The street is expecting the country to hit its 7.0% target but aggressive stimulus moves by the PBOC through the quarter including interest rate and bank reserve requirement cuts have left many wondering if growth has slowed even further. Last weekend’s surprise shortfall in China’s trade balance and the 15% drop certainly did not help the bullish case and increase the prospects for disappointment. Considering the massive moves to the upside staged by Chinese indices of late, most recently the Hang Seng, stocks could be vulnerable to a miss. The strength of China’s economy may also have a big impact on commodity trading. Copper and iron ore have retreated in recent months as Chinese demand prospects waned and lower demand hasn’t helped in the crude oil market either. The GDP figure may give traders a better ideal of which way resource demand trends are heading for this year. In addition to commodities, this could also impact indices like the S&P/ASX and resource currencies like AUD, NZD and CAD. Singapore markets may also be active today following yesterday’s big GDP and central bank driven action. Retail sales may act as a catalyst for more trading interest. NZD may also be active today around the New Zealand food inflation report. We also could see overnight positioning in EUR and CAD ahead of tomorrow’s central bank meetings even though no changes are expected. Corporate News Intel $0.41 as expected Economic News Significant announcements released overnight include: People’s Bank of China cut the interest rate on 7-day reverse repos to 3.35% from 3.45% US API oil inventories 2.6 mmbbls vs street 0.75 mmbbls US retail sales 0.9% vs street 1.1% US retail ex auto 0.4% vs street 0.7% US retail ex auto and gasoline 0.5% vs street 0.6% US producer prices (0.8%) vs street 0.9% UK same store sales 3.2% vs street 0.6% UK consumer prices 0.0% as expected UK core CPI 1.0% vs street 1.2% UK retail prices 0.9% vs street 1.0% UK producer input prices (13.0%) vs street (13.5%) UK producer output prices (1.7%) vs street (1.8%) UK ONS house prices 7.2% vs previous 8.4% Eurozone industrial production 1.6% vs street 0.8% Sweden unemployment rate 4.0% vs street 4.1% Sweden consumer prices 0.2% vs street 0.3% Spain consumer prices (0.7%) as expected Upcoming significant announcements include: 10:45 am NZST NZ food prices previous (0.7%) 10:30 am AEST Australia consumer confidence previous 99.5 12:00 pm AEST China Q1 GDP street 7.0% vs street 7.3% 12:00 pm AEST China retail sales street 10.9% 12:00 pm AEST China industrial production street 7.0% 2:30 pm AEST Japan industrial production previous (2.6%) 3:00 pm AEST Singapore retail sales street 3.0% 3:00 pm AEST Singapore retail ex auto previous (8.7%) 7:00 am BST Germany consumer prices street 0.3% 12:45 pm BST ECB interest rate and QE decision no change expected 1:30 pm BST ECB President Draghi press conference 8:30 am EDT US Empire manufacturing street 7.1 9:15 am EDT US industrial production street (0.3%) 9:15 am EDT US manufacturing production street 0.1% 8:30 am EDT Canada manufacturing sales street 0.3% 9:00 am EDT Canada existing home sales previous 1.0% 10:00 am EDT Canada interest rate decision 0.75% no change expected 10:00 am EDT Bank of Canada monetary policy report 10:30 am EDT US crude oil inventories street 3.5 mmbbls vs previous 10.9 mmbbls 2:00 pm EDT US FOMC Beige Book
What could China’s GDP report mean for markets today?
01:00, 14 April 2015