News / Analysis
Finance Update – Interest in ChinaFebruary 19, 2020
The Nikkei and Hang Seng are up this morning, as the number of new Coronavirus cases seems to be abating. Shenzhen and Shanghai are still down – 0.6 and 0.3% respectively.
Traders will be glued to the news overnight as China’s central bank mulls its new interest rate after Australia delivers January’s employment figures.
As the ECB prepares to enter its non-monetary policy meeting this morning, index futures are up after closing down in the half percent region last night.
The Euro managed to stall its downward trend at 10 am yesterday morning, despite ZEW sentiment markers for the EU and Germany that were all severely in the red.
Today, the European Commission will launch its first set of proposals aimed at boosting European companies at the expense of US online giants, such as Google, Amazon, Facebook and others.
In the UK, average earnings were down, while the claimant count for unemployment benefits only doubled to 5.5K in January, rather than soaring to 22K, as expected.
The government yesterday announced it would be shifting to a points-based immigration system – aiming to minimize the import of cheap labour, while Reuters reports a doubling of companies transferring operations from the UK to the Netherlands, primarily in the finance, information technology, media, advertising, life sciences, and the health sectors. Ahead today, CPIs, PPIs and retail prices from Britain.
US markets returned from President’s Day yesterday to a disappointing NAHB Housing Index, but a NY Manufacturing Index that was up in February to 12.9 from 4.8 the month before.
The dollar index added 30 cents throughout the day while stock markets fell 0.56% for the Dow, 0.29 for the S&P but rose 0.02% for the Nasdaq. Additionally, the yield curve for 3-month and 10-year government bonds has inverted once again – a signal for a possible recession. Up ahead – construction and producer price indexes for January.
On news of the Coronavirus retreat, oil added a dollar 80 on China-demand-based optimism throughout yesterday – this as traders await tonight’s API report. Gold was up a dollar 17, and Bitcoin regained 10K early this morning and is holding steady.
In the latest victim count for the Coronavirus, Apple shares reported a 6% drop in Frankfurt, while HSBC has warned over a 33% drop in profits, restructuring and shedding $100bn in assets and jobs over the next 3 years – as reported by Reuters. Shares were down 4% in the UK and another 2% in Hong Kong.
|9:30 AM GMT||UK||CPIs, PPIs and Retail Prices (Jan)|
|12 noon GMT||US||Mortgage Applications. PPIs, Building Permits & Housing Starts at 1:30. Dallas Fed Head RSKaplan speech at 6:30 PM.|
|1:30 PM GMT||Canada||CPIs (Jan)|
|9:45 PM GMT||NZ||PPIs (Q4 2019)|
|11:50 PM GMT||Japan||Foreign Investments in Stocks & Bonds|
|0:00 Midnight GMT||EU||European Council Meeting|
|0:30 AM GMT (+1)||Aust||Employment & Participation rates (Jan)|
|1:30 AM GMT (+1)||China||PBoC Interest Rates|