Volatile start to the week in Asia for Gold, Silver, Oil and equities amid higher yields

Asia market update: Volatile start to the week in Asia for Gold, Silver, Oil & Equities amid higher yields - but not FX. CN CCB pushes for wind-up of a CN property developer.

General trend

- Gold & Silver opened 1% softer from Friday’s close but quickly recovered with Gold hitting a fresh record high during morning trading in Asia to $3358 while Silver hit $28, despite US Treasuries rising further with UST 2-yrs rising to 4.761% and 10-yrs to 4.42%, the highest in 4 months.

- China’s March FX reserves increased, as did its gold holdings again for the 17th straight month.

- WTI crude fell more than 2% in early trading to come off highs last seen in October, but rose off its worst levels to be only -1.3% in the afternoon.

- Equities in Asia were also volatile, with the Hang Seng opening down, then rising more than 1% after CEO John Lee promised more support for the stock market, but then gave up all the gains to trade underwater for the day again.

- Nasdaq equity FUTs also rose ~1% soon after the open, but then fell back to the day’s lows.

- FX was much more muted, with most currencies stable against USD, although JPY/USD drifted higher in the direction of a potential retest of 152 again.

- TTN Research Alert: China's offshore CNH is trading down at the lower limit of the Yuan's 2.0% trading band; How will the PBOC respond this week?

- China State Banks reported to sell dollars for Yuan in FX markets.

- China Construction Bank petitioned for a wind-up of property developer Shimao (813.HK) due to outstanding debt obligations (A first for a China state-owned bank)?

- More updates from Taiwanese companies suffering relatively minor production impacts from last week’s quakes, but no significant impacts as of yet.

- US equity FUTs down slightly in mid-afternoon trading in a volatile Asian session.

Looking ahead (Asian time zone)

- Tue Apr 9th AU Mar Business & Apr Consumer Confidence, JP Consumer Confidence.

- Wed Apr 10th RBNZ Interest Rate Decision, BOJ Ueda speech, (Wed night US CPI + FOMC Minutes).

- Thu Apr 11th CN Mar CPI, (Thu night ECB rate decision, US PPI).

- Fri Apr 12th CN Balance of Trade, SG Q1 GDP + MAS Statement, KR Interest Rate Decision (Fri eve UK GDP, Fri night US Michigan Consumer Sentiment).

Holidays in Asia this week

- Mon Apr 8th Indonesia, Thailand.

- Tue Apr 9th Indonesia, Malaysia, Philippines.

- Wed Apr 10th Indonesia, Malaysia, Philippines, Singapore.

- Thu Apr 11th India, Indonesia, Malaysia.

- Fri Apr 12th Indonesia.

Headlines/economic data

Australia/New Zealand

- ASX 200 opens -0.1% at 7,770.

- Australia Jan Home Loans Value M/M: 1.5% v +2.0%e.

- RBNZ shadow board (NZIER) expects interest rates to stay on hold at 5.50% this week (decision due Wed, Apr 10th NZT) - NZIER.

- (UK) AUKUS considering expanding membership, including Japan, to deter China – FT [weekend update].

- New Zealand tightens employment visa program; Effective immediately - Immigration Ministry statement [weekend update].

- New Zealand govt: Independent panel of experts to review the country's 2050 methane targets - New Zealand press [weekend update].

China/Hong Kong

- Hang Seng opens -0.4% at 16,650.

- Shanghai Composite opens -0.4% at 3,057 (post 2-day holiday).

- Hong Kong Chief Exec Lee: Wealth mgmt is a policy priority; affirms to reinforce HK status as offshore RMB hub - comments at HSBC Global Investment Event.

- China warns institutions over misconduct related to IPO pricings – Chinese press.

- Moody's: China needs to balance a shift in its long-term growth plan with stabilizing growth in the short-term - US financial press.

- Shimao (813.HK) Comments on winding-up petition filed by China Construction Bank in connection with a financial obligation of the Company in the amount of approximately HK$1.58B.

- US Treasury Dept: Treasury Sec Yellen and China Minister of Finance Lan discussed macroeconomic outlook, keeping ‘durable’ communication between the 2 countries.

- TTN Research Alert: China's offshore CNH is trading down at the lower limit of the Yuan's 2.0% trading band; How will the PBOC respond this week?

- US Pres Biden to ‘warn’ China about South China Sea activity – FT [update].

- China Premier Li Qiang: Hopes the US and China can "meet each other halfway" - comments during meeting with US Treasury Sec Yellen (update).

- China Mar foreign reserves: $3.246T V $3.230TE [weekend update].

- Fortescue (FMG.AU) Chairman Andrew Forrest calls on China to demand 'greener' nickel supply chains – FT [weekend update].

- Russia Foreign Min Lavrov confirmed to visit China on Apr 8-9 - China Foreign Ministry [weekend update].

- China PBOC sets Yuan reference rate: 7.0947 v 7.0949 prior (Wed Apr 3rd).

- China PBOC Open Market Operation (OMO): Sells CNY2B in 7-day reverse repos; Net CNY0B v drains CNY248B prior.

Japan

- Nikkei 225 opens +1.0% at 39,391.

- Japan Feb labor cash earnings Y/Y: 1.8% V 1.8%E.

- Japan Mar Eco Watchers Current Survey: 49.8 v 51.6e; Outlook Survey: 51.2 v 53.3e.

- Japan Feb Current Account (BOP basis): ¥2.644T v ¥3.078Te.

- Japan BOJ Gov Ueda: Notes last year's fiscal economic conditions were 'fairly good' - Parliamentary testimony.

- Japan's labor market is losing depth, with the share of potential workers falling by 50% over two decades - Japanese press.

- Bank of Japan (BOJ) announcement related to outright bond buying operations: For 1-3 Years; 5-10 Years and >25 Years; (inline with prior amounts).

- Reportedly to build second fab in Kikuyomachi, Kyushu, Japan - Japanese media citing Co exec [weekend update].

South Korea

- Kospi opens +0.2% at 2,718.

- South Korea Mar Foreign Net Investment in Local Bonds (KRW): -5.85T [largest outflow since Jan 2023] v +3.46T m/m.

Other Asia

- Foxconn (2317.TW) Reports Mar (NT$) Rev 447.5B, +27% m/m, +11.8% y/y v -12.4% prior (1st rise since Nov 2023); Guides Q2 growth both q/q and y/y (weekend update).

- Thai Baht continues weakness ahead of Thailand's Central Bank (BOT) rate decision on Wednesday.

- Taiwan Semi (TSM) Affirms FY Rev guidance 'low to mid 20s percentage growth" given at Jan conf following Earthquake in Taiwan – press [weekend update].

- India Mar Passenger Vehicle Retail Sales 322.3K units, -6.2% Y/Y – FADA.

- Malaysia Feb Industrial Production Y/Y: 3.1% v 1.7%e.

North America

- USW steelworkers in Pittsburgh still opposing Nippon Steel deal; Holders to vote on Friday for deal – WSJ [weekend update].

- TSLA CEO Elon Musk refutes report ending plans to build low cost car; Claims Reuters is lying regarding report on low-cost EVs – X [weekend update].

- Elon Musk says autonomous Tesla Robotaxi will be unveiled on August 8, 2024 [weekend update].

- (US) Fed’s Bowman (voter, hawk): While not likely, it is possible Fed may have to hike again to cool inflation [weekend update].

- (US) Mar change in Nonfarm Payrolls: +303K V +214KE (above all analysts' estimates) [weekend update].

- (US) Mar average hourly earnings M/M: 0.3% V 0.3%E; Y/Y: 4.1% V 4.1%E (lowest annual pace Nov 2023) [weekend update].

- (US) Mar unemployment rate: 3.8% V 3.8%E [weekend update].

- (US) Feb consumer credit: $14.1B V $15.0BE [weekend update].

Europe

- (IL) Hezbollah Chief Nasrallah: Strike on Iranian consulate in Damascus is the turning point in events since Oct 7th [weekend update].

Levels as of 01:20 ET

- Nikkei 225, +0.8%, ASX 200 +0.2% , Hang Seng +0.1%; Shanghai Composite -0.1%; Kospi +0.6%.

- Equity S&P500 Futures: -0.1%; Nasdaq100 flat, Dax flat; FTSE100 flat.

- EUR 1.0823-1.0844 ; JPY 150.57-151.81 ; AUD 0.6560-0.6590 ;NZD 0.5999-0.6018.

- Gold +0.5% at $2,358/oz; Crude Oil -1.4% at $85.69/brl; Copper -0.2% at $4.2332/lb.