ASIA STOCKS: Investors Return To Asian Equities As Semiconductors Rally
South Korea & Taiwan saw inflows on Thursday as Semiconductor stocks rose globally, while TSMC also reported quarterly earnings.
- South Korea: Recorded inflows of +$584m yesterday, contributing to a 5-day total of -$351m. YTD flows are positive at +$501m. The 5-day average is -$70m, worse than the 20-day average of +$3m but better than the 100-day average of -$149m.
- Taiwan: Registered inflows of +$993m yesterday, resulting in a 5-day total of -$2.44b. YTD flows are negative at -$2.53b. The 5-day average is -$488m, significantly worse than the 20-day average of -$206m and the 100-day average of -$128m.
- India: Posted outflows of -$508m Wednesday, contributing to a 5-day total of -$2.88b. YTD flows are negative at -$4.03b. The 5-day average is -$577m, worse than the 20-day average of -$280m and the 100-day average of -$62m.
- Indonesia: Recorded inflows of +$26m yesterday, with the 5-day total at -$12m. YTD flows are negative at -$181m. The 5-day average is -$2m, better than the 20-day average of -$20m and the 100-day average of +$4m.
- Thailand: Posted outflows of -$36m yesterday, resulting in a 5-day total of -$155m. YTD flows are negative at -$186m. The 5-day average is -$31m, worse than the 20-day average of -$11m and the 100-day average of -$8m.
- Malaysia: Experienced outflows of -$47m yesterday, contributing to a 5-day total of -$262m. YTD flows are negative at -$381m. The 5-day average is -$52m, worse than the 20-day average of -$26m and the 100-day average of -$17m.
- Philippines: Recorded outflows of -$19m yesterday, resulting in a 5-day total of -$56m. YTD flows are negative at -$80m. The 5-day average is -$11m, worse than the 20-day average of -$8m and equal to the 100-day average of $0m.
Table 1: EM Asia Equity Flows
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MNI: JAPAN NOV EXPORTS +3.8% Y/Y; SEPT +3.1%
- MNI: JAPAN NOV EXPORTS +3.8% Y/Y; SEPT +3.1%
- JAPAN NOV EXPORTS POST 2 ND STRAIGHT Y/Y RISE
- JAPAN POSTS JPY117.6 BLN TRADE DEFICIT IN NOV
JGB TECHS: (H5) Shallow Correction
- RES 3: 149.55 - High Mar 22 (cont)
- RES 2: 147.74 - High Jan 15 and bull trigger (cont)
- RES 1: 144.48/146.53 - High Nov 11 / High Aug 6
- PRICE: 142.25 @ 16:04 GMT Dec 17
- SUP 1: 141.88 - 1.618 proj of the Aug 6 - Sep 3 - 9 price swing
- SUP 2: 141.56 - 1.764 proj of the Aug 6 - Sep 3 - 9 price swing
- SUP 3: 141.05 - 2.000 proj of the Aug 6 - Sep 3 - 9 price swing
JGB futures are trading above their recent lows and the latest shallow recovery appears to be a correction. Medium-term trend signals on the continuation chart continue to point south. A resumption of the trend would pave the way for a move towards 141.88 and 141.56, Fibonacci projection points on the continuation chart. A stronger recovery would open 144.48, the Nov 11 high. Further out, key resistance is at 146.53, the Aug 6 high (cont).
JGBS: Futures Downtick Overnight As US Tsys Tread Water Ahead Of FOMC
In post-Tokyo trade, JGB futures are little changed, -1 compared to settlement levels, after US tsys finished Tuesday mostly flat, with little apparent conviction ahead of the FOMC meeting.
- US Tsy futures dipped through support at 109-20 (Nov 20/21 low), reaching a low of 109-17, before recovering modestly after US retail sales data came in more or less in line, and industrial production was on the weak side (the Atlanta Fed's GDP nowcast was downgraded 0.2pp for Q4 to 3.1% following the data).
- There was a final pullback into the close on elevated volumes, which saw US tsys end basically unchanged for the session. There was no apparent trigger for this and it appeared more like anticipation of Wednesday's FOMC decision.
- There was little reaction to a 20Y auction that tailed 1.5bp, but it was at least better than November's much poorer sale.
- On the data front today we have the Nov trade figures. The market expects export growth similar to Oct (forecast at 2.5% y/y).
- Pricing for tomorrow's BoJ has edged up a little, but at 20% implied probability of a hike, is still well off late Nov highs.
