WHAT HAPPENED OVERNIGHT IN THE US:
· S&P +0.4%, rallied early but ran out of steam late – within 6pts of record high.
· Techs fine again; Weibo +2.4% at $23.15 (vs IPO $17). Facebook and Apple both positive ahead of nos tonight.
· And earnings ok; of 118 S&P500 so far, 64% have reported higher earnings y/y, 70% have beaten ests (Bberg).
WHAT’S UP THIS MORNING IN THE EAST:
· Asia mixed, but fly-in-the-ointment China April flash PMI 48.3 mired in contraction for 4th straight month.
· Japan +0.7% heading for first gain in 3, but China -0.4% and Hong Kong -0.8% both off early highs (+0.5%).
· Tencent +2% has successfully sold $2.5bn bonds – the largest ever offshore debt sale by non-state Chinese company. The bulk of the deal pays 3.4% on $2bn due 2019 ie 165bps over US Treasury - a new low for the company – and was 66% taken up by US investors. The cash will offer more flexible funding for acquisitions.
· Australia +0.7% at a fresh 6yr high, with big help from IT +2.2%. Miners mixed (indicate flat London open), but off early lows with help from AUD -1% at 3-week low 0.9282 (knocked by China PMI release). Inflation data underpinning floating rates; Q1 CPI +2.9% is bumping up against RBA ceiling for first time since 2011.
SOUTH AFRICAN NEWS:
· Expect AllShare +0.25%. From SA close yesterday, gold +$3 ($1284), plat +$6 ($1402), ZAR unchanged (10.51), S&P unchanged.
· PMI data today will dictate direction, but in generally subdued trading and absence of howlers, path of least resistance remains higher.
TODAYS KEY DATA POINTS:
· 9am: SA Feb Lead Indicator
· 9.30am: Germany April Markit PMI Manuf first read (53.8)
· 10am: SA March CPI (+5.9% y/y, +1.1% m/m)
· 10.30am: BoE minutes, UK March Public Finances
· 12pm+: Procter & Gamble (102c), Boeing (154c), Dow Chem (71c), etc
· 3.45pm: US April Markit PMI Manuf first read (56)
· 4pm: US March New Home Sales (+2.3% m/m)
· US after-hrs: Apple (1016c), Facebook (24c)