Chines Data Proves Positive For Markets
Equities in Asia traded mostly higher, although gains were capped by a slew of tier-1 Chinese data including GDP, Industrial Production and Retail Sales
• FX markets were relatively quiet, with USD/JPY range-bound, while GBP/USD saw a mild pullback from yesterday’s CPI-inspired gains to relinquish 1.2300
• Looking ahead, highlights include BoC rate decision, UK jobs report, DOE's, Fed's Kaplan, Fed's Williams and BoE's Haldane
Asia equity markets traded mostly higher following the positive lead from Wall St., although gains were capped as participants digested a slew of tier-1 Chinese data including GDP, Industrial Production and Retail Sales. ASX 200 (+0.4%) and Nikkei 225 (Unch.) traded flat as oil names benefitted from advances in WTI after an unexpected drawdown in API crude inventories, while consumer discretionary outperformed in Australia on M&A news flow regarding an AUD 11bln merger between Tabcorp and Tatts Group. Chinese markets were mixed with Shanghai Comp. (+0.1%) in the green, while Hang Seng (-0.2%) lagged after mixed data in which GDP printed in line with estimates and Retail Sales posted an 8-month high, however Industrial Production fell short of estimates and several HK firms issued profit warnings.
Chinese GDP SA (Sep) Q/Q 1.80% vs. Exp. 1.80% (Prev. 1.80%)
Chinese GDP (Q3) Y/Y 6.70% vs. Exp. 6.70% (Prev. 6.70%).
Chinese Industrial Production (Sep) Y/Y 6.10% vs. Exp. 6.40% (Prev. 6.30%)
Chinese Industrial Production YTD (Sep) Y/Y 6.00% vs. Exp. 6.10% (Prev. 6.00%).
Chinese Retail Sales (Sep) Y/Y 10.70% vs. Exp. 10.70% (Prev. 10.60%): 8-month high.
Chinese Retail Sales YTD (Sep) Y/Y 10.40% vs. Exp. 10.30% (Prev. 10.30%).
China National Bureau of Statistics said the economy is better than expected, although still faces uncertainty. The stats bureau also stated that employment is better than expected and that China is to ensure it will achieve its annual growth target.
The Peoples Bank of China set mid-point at 6.7326 (Prev. 6.7303) and injected CNY 65bln in 7-day reverse repos, CNY 50 in 14-day reverse repos and CNY 35bln in 28-day reverse repos.
Japan ruling LDP party VP Komura is said to affirm plans for longer term limits for party leadership, which could keep PM Abe in power beyond 2020.
EUROPE AND THE UNITED KINGDOM
UK Chancellor Hammond said he will not quit the cabinet despite accusations he is undermining Brexit.
Commodity-linked currencies were initially supported with NZD an early outperformer after advances in crude and increase in milk prices at the GDT auction. However, gains were then pared following the release of mixed Chinese data. The remainder of FX markets were relatively quiet, with USD/JPY range-bound, while GBP/USD saw a mild pullback from yesterday’s CPI-inspired gains to relinquish 1.2300.
Oil prices forged ahead on an unexpected API drawdown which saw WTI approach towards USD 51.00/bbl. Gold (+0.1%) held onto yesterday’s advances on a weaker USD, however, rising stocks limited gains, while copper remained subdued following mixed Chinese data.
US API Crude Oil Inventories (Oct 14) W/W -3800K vs. Exp. 2400K (Prev. 2700K).
Fox News poll showed Clinton ahead of Trump by 6 points at 45% vs. 39% (Prev. 45% vs. 38% last week)
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