New Overnight Developments Abroad: Stocks Higher, Dollar Narrowly Mixed
April 9, 2009
Stocks rose 3.7% in Japan, 3.0% in Hong Kong, 4.3% in South Korea, 2.5% in Singapore, 1.0% in the Philippines, and 1.6% in China. The German Dax and Paris Cac are trading up by 1.1% and 0.5%, but the British Ftse is unchanged.
The dollar has firmed 0.4% against the yen, 0.2% versus the Australian dollar, and 0.1% against sterling, but it has lost 0.6% against the kiwi, 0.3% relative to the euro, and 0.1% against the Swiss franc and Canadian dollar.
Oil jumped 3.% to $50.96 per barrel, while gold is steady at $885.20 per ounce.
Yields on ten-year bunds and JGB’s are higher. Japan’s market scared by Y15.4 trillion price tag on proposed fiscal stimulus.
The Bank of England left its rates and quantitative easing parameters unchanged as expected.
Canada suffered the loss of another 61.3K jobs in March in a continuation of the most rapid labor market deterioration in 27 years. The jobless rate rose to 8.0% from 7.7%.
Core private Japanese machinery orders unexpectedly rose 1.4% in February but were still down 30.1% from February 2008, and the Jan-Feb level was 9.4% less than the 4Q08 level. Foreign machinery orders sank 22.9% and 74.3% y/y, and manufacturing orders dropped 8.1%. Although officials softened their assessment to “rising slightly but the declining trend is continuing,” the data still convey a very weak overall picture and prognosis.
Japanese sold a record net Y 2.1 trillion of foreign bonds last week, contributing to a net Y 2.14 trillion net inflow on stock and bond transactions, a sharp reversal from the Y 1.82 trillion net outflow in the week to March 28. This period represents the cusp between two fiscal years.
Australia’s jobless rate leaped another half-percentage point to 5.7% in March and compared to 4.5% at end-2008. Australia shed a greater-than-expected 34.7K jobs last month and lost 90.3K full-time workers in the two months between January and March.
German industrial production fell 2.9% in February and by 23.2% over the last 12 reported months. Factory output dropped 3.3%, led by a 4.5% decline in capital goods. Officials noted that sharply falling industrial orders points to continuing losses in output over coming months. Final German consumer price data for March confirmed the preliminary indications of a 0.1% monthly dip and a 12-month increase of only 0.5%. Energy fell sharply.
India’s industrial production fell 1.2% in the year to February, a sharp collapse from gains of 8.1% and 11.6% in the past two fiscal years.
As expected, the Bank of Korea left its 7-day repo rate unchanged for a second straight month at 2.0%. Between October 9th and February 12th, the policy rate had been cut six times from 5.25% to 2.0%. South Korea reported rises in March producer prices of 0.5% from February and 3.5% from March 2008. That was down from a 4.7% rise in the year to January.
Peru’s central bank cut its benchmark interest rate by 100 basis points to 5.0% late yesterday.
Italian industrial production slumped 3.5% in February, almost twice as much as forecast, and posted a working-day adjusted 23.7% drop from February 2008.
Britain’s PPI-O index edged 0.1% higher in March, but its 12-month change slowed to +2.0% from +3.0%. Core output producer price inflation of 3.3% was the lowest in 12 months. The PPI-I index jumped more than expected, a 1.0% gain from March. Even so, the producer input price index recorded the first on-year dip in 19 months.
The British merchandise trade deficit of Gbp 7.32 bln in February was smaller than forecast and down from Gbp 7.82 bln in January. The goods and services deficit widened slightly to Gbp 3.25 billion from Gbp 3.14 bln. The volume of exports and imports recorded declines of 5.5% and 8.5% in the latest three reported months from the previous three months.
Chinese car sales advanced 10.3% in the year to March, and business sentiment rebounded to 101.1 in 1Q09 from an 8-year low of 94.6 in 4Q08.
Dutch consumer price inflation remained steady in March at 2.0%. Swiss unemployment rose two-tenths to a 31-month high of 3.3% in March.
New Zealand home sales rebounded 28% in March to a four-month high.
There was some violence in Papua in connection with Indonesia’s parliamentary elections.
At 12:30 GMT, the U.S. and Canada release monthly trade statistics. U.S. import prices and jobless claims also get announced. Hoenig and Stern of the Fed speak publicly today. The U.S. Treasury market will close at 14:00 EDT (18:00 GMT) for the Good Friday holiday. Many European markets will remain closed until Tuesday for the Easter break.
Copyright 2009 Larry Greenberg. All rights reserved. No secondary distribution without express permission.
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