EUROPEAN EQUITY OPEN: Lower/mixed start as OPEC+ announces surprise move to cut output; final PMI data due later today, ahead of US ISM data

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  OVERNIGHT: Asia-Pac equity markets were mostly positive amid strength in the energy sector after oil prices were boosted by a surprise voluntary output cut by OPEC+ members although gains in the broader market were capped heading into this week’s key events and as participants digested a slew of data releases including disappointing Chinese Caixin Manufacturing PMI; Pantheon Macroeconomics said the data pointed to Chinese private sector manufacturing activity stalling in March. There was also a mixed BoJ Tankan Survey; Capital Economics said the data suggests that while the Japanese services sector remains resilient, the outlook for its manufacturing sector has worsened materially (see here).


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  EUROPEAN OPEN: European equities have begun the week on a note of caution, with higher oil prices applying upward pressure on bond yields amid fears that there could be implications for the continuing battle against high inflation. The disappointing Caixin manufacturing PMI out of China and mixed Tankan report out of Japan is also adding to the downbeat mood, particularly for the manufacturing sectors ahead of today’s release of final PMI data across Europe.


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  STOCK SPECIFICS: On the financials front, Swiss AG will investigate whether Credit Suisse (CSGN SW) and UBS (UBSG SW) merger broke Swiss criminal law, and is looking into potential breaches by government officials; elsewhere, UBS will reportedly cut its workforce by 20-30% after completing Credit Suisse takeover. On the energy front, energy names will be looked at in the context of higher oil prices, following the OPEC+ surprise announcement to cut output. UK regulators are expected to announce approval for Equinor's (EQNR NO) Rosebank oilfield in April. On the M&A front, ThyssenKrupp (TKA GY) is reportedly reviving plans to sell its submarine and maritime systems arm. On the tech front, Capita (CPI LN) said it had experienced a cyber incident largely impacting access to internal Microsoft Office 365 (MSFT) applications, adding that there was no evidence of compromised data. In communications, Cineworld (CINE LN) intends to raise USD 2.26bln via a senior secured debt credit facility and issuance of new stock. Our full stock specific briefings for April 3rd can be accessed here and here.

DAY AHEAD:

• Our full interactive calendar can be accessed here; a pdf version can be accessed here.


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  DAY AHEAD: The week begins with little on the docket of note. OPEC+'s JMMC will be looked to after the surprise weekend announcement to cut crude output, which has sent crude prices higher, and has drawn criticism from the US (see here). On the data front, final PMI data across the Eurozone is due, with the major indices from the Eurozone, Germany and France expected to be unrevised. The US Day will see the release of the ISM Manufacturing survey for March, where the headline is seen little changed. US Construction Spending for Feb is also set to be released. Fed's Bullard (non-Voter, Hawk) will give an interview to Bloomberg TV; Bullard last week was making the case the financial stress should be contained with macro prudential tools, and monetary policy should keep its focus on applying downward-pressure to inflation. BoC watchers will note the release of the Business Outlook Survey ahead of the April 12th confab.


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  WEEK AHEAD: ISM manufacturing and services PMIs from the US, Caixin PMI data out of China, rate decisions from the RBA, RBNZ and RBI, and the key US jobs report on Friday (Good Friday, markets will be shut, although the desk will run a special service covering the event). On the geopolitical front, European policymakers will be visiting China this week, where Europe aims to "de-risk" its relationship with Beijing rather than "decouple" from it, according to RANE Group. See here for our full week ahead briefing.

03 Apr 2023 - 08:10- Fixed IncomeData- Source: Newsquawk