(Note that these are solely the views & opinions, they do not constitute any trade or investment advice of any kind.)
To see this wk’s Macro Monday click here
APAC Global Macro Morning Brief
Happy Macro Thu 28 Nov 2019: Bears In Charge, As Asia Thanksgiving Morning Starts
Early doors this beautiful Asia Thu morning, yet we have US equity futures down about -30bp to -40bp, this post an overnight session that saw another +0.42% lift on SPX to 3154
VIX is still at the Smurf heights of c. 11.75 lvls. Much of the European equity Indices also fared well in the session o/n, with the trend being bucked by the CAC (basically unchanged) & the FTSE MIB (-0.26%)
Trumps signing of the US Congress Passed HK Bill, likely was not the best thing for risk appetite, with the timing being questionable at best given that its happened early Asia morning post the US Wed close it should be noted
Still overall US equity strength has been relentless, many a times we see weakness in the Asia & EZ sessions reversing once the US gets in, yet the US will be out today, given the public holiday of Thanksgiving
Save driving out there – all 55 million of you – especially given there seems to be some seriously icey roads across the country
Always cracks KVP up when he thinks of London, one snowflake & the city’s transport grid shuts down. KVP has been to Moscow at -20 degrees Celsius, business ticks on… its all relative
Speaking of Turkeys & things being relative, Trump continues a tradition of the presidential Turkey pardon – with the pardoning of Bread & Butter
One last comment on the bearish Asia equities start to the day, its not yet fully being reflect in DollarYen 109.36 -0.16%, USDCNH 7.0249 +0.13% or gold & silver 1457 +0.20%, 16.98 +0.12%
Nor even some of the futures in the region, i.e. ASX is +0.26% to 6877
Trump has given Beijing the opportunity to control the discussion & news flow over US Thanksgiving Holiday
This could definitely get a lot worse, lets us see what Beijing comes back with – if they take the hard route of saying phase one deal is off, then expect some big moves & some very happy bears
In such a scenario DollarYen 109.36 easily gets sub 108.00
USDCNH 7.02 easily above 7.05-7.15
Gold & Silver ‘easily’ up +1.5% to +3%… taking us to a 1480 – 1500 range for gold & a 17.23 – 17.50 range for silver…
…and VIX could do +25% to +50% easily
–
Overnight notable econ data prints
Beats:
Australia quarterly construction work beat at -0.4%a -1.0%e -2.8%r (-3.8%p)
US Durable goods +0.6%a -0.5%e -1.2%r (-1.1%p), & even the secondary 3Q GDP reading beat again at 2.1%a 1.9%e/p (USA! USA! USA!), unemployment claims were also better at 213k a 223k e 228k p
Misses:
US Chicago PMI missed at 46.3a 47.2e 43.2p (Richmond also missed [widely] on Tue), Core PCE QoQ 2.1%a 2.2%e/p, PCE Deflator 1.3%a 1.4%e 1.3%p, Pending Home Sales -1.7%a +0.2%e +1.5%p (int as home data on Tue was quite strong)
Lastly crude oil inventories were 1.6m vs. an expected -0.5m, which clearly moved WTI lower to a session low of 57.51 before closing at 58.11 -0.51% for Wed
So far this Asia thu mrn we are down c. -0.31% to 57.93 on WTI. Brent 64.06 -0.33% as well this mrn
–
Have a brilliant day to excellent long wkd for those capitalizing on the TG break
Enjoy the down time with loved ones, everything else is just noise at the end of the day
Namaste
-KVP
Today:
- JP: -7.1%a -3.8%e +9.1%p
- wow, makes you wonder what the print would have been if they had not hosted the Rugby World cup last month, obviously numbers skewed by the consumption tax increase in Oct to 10%
- policy fumble imho. I.e. they have so much debt in a predominantly closed system, trying to be prudent by taking the consumption tax from 8 to 10, is not going to be a structural game changer. What it likely does though is increase the delta for more fiscal spend, which may have been the strategy in the first place.
- NZ: ANZ business confidence ticked up from previous -26.4a -42.4p
- Early doors tmr we will get building consents 7.2%p
- AU: Private Quarterly Capex -0.2%a 0.0%e -0.5%p
- EZ: GER Flash CPI 1.1%e 0.9%p, M3 Money Supply, Private Loans
- US: Bank holiday
- CA: Current Account
Other:
- To catch this wk’s Macro Monday Click here… & replay of the call here
- Don’t forget to bookmark & check our Daily SaxoStrats calls from the European morning session c. 09:00 CET
Some Pieces From the Rest of the SaxoStrats Squad
- Peter’s on equities: Is it time to reduce exposure to health care?
- Dembik’s Monthly Macro Outlook: The great stabilization
- Hansen’s Latest on commodities: Crude oil grinds higher with focus on OPEC & Trade Talks
- Hardy’s on currencies: FX Deep Dive – Staggering complacency ahead of 2020
- Eleanor on Australia: QE Down Under
The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.
Please read our disclaimers:
– Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
– Full disclaimer (https://www.home.saxo/legal/disclaimer/saxo-disclaimer)
– Full disclaimer (https://www.home.saxo/en-mena/legal/disclaimer/saxo-disclaimer)
