*Global Markets Wrap: Thursday, April 06, 2017.*
*Asia was in the red, Nikkei drops 0.8%, Kospi falls 0.6%, ASX down 0.3%*
Asian markets fell on Thursday morning, tracking losses on Wall Street after the Federal Reserve released its March Federal Open Market Committee (FOMC) minutes which was viewed as hawkish.
Last month’s FOMC minutes reflected Fed officials’ intention to unwind the central bank’s balance sheet later in the year if economic data continues to hold up.
The Fed currently holds $4.5 trillion in bonds and actions to trim the balance sheet could have a major impact on markets given its magnitude.
Fed Chair Janet Yellen indicated that such a move would be akin to a rate hike.
The Fed warns of “downside risks” to forecasts if “financial markets were to experience a significant correction”.
“The reaction here has been quite punchy and it’s interesting that there were no real discussions about a lesser need to hike rates if the balance sheet is also being used as a policy tool – a theme Bill Dudley has been pushing of late,” said Chris Weston, chief market analyst at spread-better IG, in a Thursday note.
Meanwhile, ADP payrolls data showed that 263,000 workers were added in March, higher than market expectations of 185,000. This was also the most number of jobs added since December 2014, suggesting tightening in the U.S. labor market.
Japan’s Nikkei 225 fell 0.81 percent in early trade, with yen strength noted. The Kospi dropped 0.58 percent.
Australian benchmark ASX 200 was lower by 0.32 percent, pressured by its energy and financials sub-indexes.
Traders are also expected to focus on the highly-anticipated meeting between President Donald Trump and Chinese President Xi Jinping, later in the day in Florida.
PBOC weakens the Yuan reference rate 0.03% to 6.8930 against the USD from 6.8906 Wednesday.
In Australia, miner Glencore declared force majeure on coal shipments after Cyclone Debbie hit the northeastern state of Queensland, damaging a railway pass that connected coal mines to ports. Force majeure is typically invoked after events beyond the control of companies, such as natural disasters, occur.
*Economic Data Calendar:*
– China Econ: Caixin PMI Composite 52.1 in March versus 52.6 in February.
– China Econ: Caixin PMI Services 52.2 in March versus 52.6 in February.
– Japan’s March consumer confidence is also on tap.
– Reserve Bank of India’s monetary policy decision due later.
Markets in Thailand and Vietnam are closed for public holidays.
* Congress leaders call for Ajay Maken’s removal over ticket distribution(var)
* Govt prepares draft guidelines for accreditation of NGOs (ET)
* AIADMK factions of Panneerselvam, Palaniswami plan reunion (ToI)
* SC dismisses plea to review abatement of appeal against Jayalalithaa (TH)
* Shia body issues fatwa against cow slaughter, backs triple talaq ban (News18)
* Swaraj says attack on Africans “criminal”, cannot be called racial (NDTV)
* Shiv Sena hires chartered flight for MP Ravindra Gaikwad (ET)
* Shiv Sena MP Gaikwad may attend Parliament this week to tell his story (PTI)
* China says Dalai Lama’s Tawang visit will “escalate” border tensions (var)
* Sushma Swaraj warns Pakistan, says entire J&K belongs to India (ZEE)
* White House chief strategist removed from National Security Council (RTR)
* US warns of unilateral action if UN fails to act on Syria (AFP)
* Suu Kyi denies ethnic cleansing of Myanmar minority (BBC)
* US may widen ban of carry-on computers on planes (AFP)
* Russia denies Assad role in Syria chemical attack, says rebels to blame (RTR)
* Islamic State calls US President Trump “stupid idiot” (PTI)
* Suicide bomber kills at least 7 in Lahore, Taliban claims responsibility (IE)
* Days after metro attack, 6 ‘terrorist’ recruiters detained in Russia (AFP)
* Suicide bombers kill 31, injure at least 42 in Iraq, say officers (AFP)
==BUSINESS AND ECONOMY==
* Jaitley moves GST Bills for consideration in Rajya Sabha (Cogencis)
* Cabinet OKs setting up railway regulator; may start ops in 4-5 mos(Cogencis)
* Centre OKs 50 more days of work under job plan to 8 drought-hit states (ET)
* Govt mulls easing FDI rules for food retail (FE)
* RJio may generate 213-bln rupee revenue for Reliance Ind, says Moody’s (FE)
* India plans high speed diesel pipeline to Bangladesh (ET)
* Time to build new India, exploit resources, says Vedanta Agarwal (ET)
* Govt says India to become 2nd largest steel producer by 2018 (ET)
* SEBI Chief Tyagi to meet investment bankers over primary market reforms (BS)
* Govt moves Bill to up NABARD’s authorised capital to 300 bln rupees (Cogencis)
* Steel min floats proposal to prefer local steel in govt projects (Cogencis)
* Govt says no plans to demonetise 2,000-rupee notes (PTI)
* LIC softens stance on UTI MF public offer (BS)
* Govt may replace drugs & cosmetics Act, draft to be ready in 5-6 mos(Cogencis)
* RBI, SEBI in talks to resolve issues linked to FPI stake in stocks (Cogencis)
* Former RBI dy governor Gandhi sees payments cos consolidating (Cogencis)
* Tata Motors arm JLR Mar US sales up 19% YoY; Land Rover sales lag(Cogencis)
* M&M Mar total production 50,711 units vs 53,196 year ago (Cogencis)
* Aditya Birla Idea Payments Bk gets payments bank licence from RBI (Cogencis)
* Etihad Airways shuts ticketing and reservation offices in India (ET)
* SEBI survey says FDs score big over equities, MFs for investment (PTI)
* Air India ticket sales to US up by 100% after luggage ban (PTI)
* Prabhu says railways to add 1000 MW of solar, 200 MW of wind energy (PTI)
* NTPC FY18 coal requirement seen at 186.5 mln tn, up 9% YoY (Cogencis)
* BJP Swamy for transfer of private cos’ GST Network holding to PSUs(Cogencis)
* SC bench to hear plea on WhatsApp privacy issue on Apr 18 (Cogencis)
* MTNL says mulling sale of real estate assets to pare debt (Cogencis)
* Uttar Pradesh to pay 10 rupees/100 kg extra for wheat procurement (Cogencis)
* Govt says duty-free sugar import for cos with own refining ops (Cogencis)
* Govt extends sops on onion exports by 3 months, till Jun 30 (Cogencis)
* Essar plans 100-bln rupee port in Gujarat (BS)
* First oil from small field award in 4 months, says bid winner (BS)
* Report says Samsung most trusted brand in India (PTI)
* CRISIL says RBI will have to continue inflation vigil in FY18 (ET)
* ICRA says M&As in road sector pick up over easier exit norms (BS)
* ONGC plans up to 650-bln-rupee investment for exploring KG basin (BS)
* UK services PMI rises to 55 in Mar from 53.5 in Feb, beats forecast (BBC)
* JP Morgan chief Dimon backs Trump on relaxed bank rules (FT)
* German economy minister says cash must stay, even in digital age (ET)
* French business activity nears six-year high, PMI shows (ET)
* US agrees to ChemChina’s $43-bln takeover of Syngenta (ET)
* BMW workers in UK to strike over pensions (BBC)
* Toshiba’s Westinghouse replaced chairman 2 days before bankruptcy filing (ET)