Newsquawk Daily Asia-Pac Opening News - 24th February 2025

• US stocks tumbled on OpEx Friday and T-notes rallied across the curve in which the pressure in US stocks began in the morning amid the backdrop of the deterioration of Ukraine relations with the US and lingering tariff deadlines, while the attention was on weak US PMI data and reports of a potentially pandemic inducing Coronavirus being found in China.


• Exit poll by ARD showed Germany’s conservative CDU party won the election with 29% and the far-right AfD was in second place with 20%, while German Chancellor Scholz’s SPD was in third place with 16%.


• Looking ahead, highlights include New Zealand Credit Card Spending & Singapore CPI, Supply from Australia, Markets in Japan are Closed for Holiday.

LOOKING AHEAD

• Highlights include New Zealand Credit Card Spending & Singapore CPI, Supply from Australia, Markets in Japan are Closed for Holiday.


• Click for the Newsquawk Week Ahead.

US TRADE

• 
  US stocks tumbled on OpEx Friday and T-notes rallied across the curve in which the pressure in US stocks began in the the morning amid the backdrop of the deterioration of Ukraine relations with the US and lingering tariff deadlines, while the attention was on weak US PMI data and reports of a potentially pandemic inducing Coronavirus being found in China.


• 
  SPX -1.71% at 6,013, NDX -2.06% at 21,614, DJI -1.69% at 43,428, RUT -2.94% at 2,195.


• Click here for a detailed summary.

TARIFFS/TRADE

• 
  US President Trump’s team is reportedly pushing Mexico towards tariffs on Chinese imports, according to Bloomberg.


• US President Trump said late on Friday that the US will establish new rules to stop US firms from investing in industries that advance China’s national military-civil fusion strategy and will establish new rules to stop China-affiliated people from buying up critical American businesses and assets.


• 
  US President Trump said on Friday that he spoke with Chinese President Xi on fentanyl. It was also reported that a White House official said President Trump is to sign a national security memorandum aimed at promoting foreign investment while protecting US national security interests from threats posed by foreign adversaries like China.
  


• US House Chair Jordan criticised EU tech fines and European taxes on US companies and wants the European Commission to brief the judiciary committee by March 10th and called for EU antitrust chief Ribera to clarify rules reining in big tech.

NOTABLE HEADLINES

• 
  Fed’s Goolsbee (2025 voter) downplayed a report from last week which showed an increase in consumers’ expectations for future inflation whereby he stated that it wasn’t a great number but added it is only one month of data and at least two or three months for it to count, according to Bloomberg.


• 
  US President Trump said Elon Musk is doing a good job but he would like to see him get more aggressive. It was separately reported that Elon Musk said consistent with President Trump’s instructions, all federal employees will receive an email requesting to understand what they got done last week and a failure to respond will be taken as a resignation, although some agencies told workers not to reply to Musk’s email.
  


• US President Trump nominated Air Force Lt General Dan Caine as the next Chairman of the Joint Chief of Staff to replace General Brown, while several other top officials were also pushed out.


• US President Trump reportedly told CEOs of pharmaceutical companies during a meeting to move their production to the US.


• 
  American Airlines (AAL) flight was diverted to Rome over ‘possible security issue’, according to ABC News. However, the airline later stated that the flight landed safely in Rome and after inspection by law enforcement was cleared to re-depart with the issue determined to be non-credible.

COMMODITIES

• 
  Iraq’s Oil Minister said all procedures for exporting oil through the Turkey pipeline have been completed. It was separately reported that Iraq denied reports alleging it will face US sanctions if oil exports from Kurdistan were not resumed, Iraqi Kurdistan authorities agreed with the federal oil ministry to restart Kurdish crude exports based on available volumes, according to a KRG statement.


• 
  Iraq is to receive 185k BPD from the Kurdistan region in the first phase after the resumption of oil exports, according to Iraq's Oil Ministry.


• South African power utility Eskom said stage 6 power cuts were implemented from Sunday morning.

GEOPOLITICAL

MIDDLE EAST

• 
  Israel sent tanks into the West Bank and told troops to prepare for an extended stay, according to Reuters.


• Israeli PM Netanyahu’s office said the release of Palestinian prisoners planned for Saturday was delayed until the release of the next hostages is secured with the delay due to Hamas’s repeated violations.


• Hamas strongly condemned Israel’s decision to postpone the release of Palestinian prisoners and said Israel’s claim that a handover ceremony is humiliating is false and a pretext to evade its obligations.

RUSSIA-UKRAINE

• 
  Ukrainian President Zelensky said the issue of elections is a step to apply pressure on Ukraine and he is willing to quit the presidency if it means peace in Ukraine which he said could be exchanged for NATO membership, but also commented that false statements about his ratings and the amount of US aid are dangerous steps to weaken Ukraine. Zelensky said he sees Turkey as an important security guarantor for Ukraine and that Ukraine is working on Patriot system alternatives, as well as noted if the US strikes a deal with Russia to end the war, it won’t be successful if Ukraine does not agree to its conditions.
  


• 
  Ukrainian President Zelensky commented that Ukraine-US talks on a minerals deal are moving forward and all is okay, while he stated that the minerals deal draft said Ukraine should return two dollars for each dollar of aid supplied by the US. Zelensky also said the USD 500bln figure is not being considered in the minerals deal anymore and a top aide said he had a constructive new round of talks with the US on the minerals deal. It was separately reported that the US could cut Ukraine’s access to Starlink internet services over minerals, according to sources cited by Reuters.


• US President Trump said he thinks the US is pretty close to a minerals deal with Ukraine and that they are asking for rare earth, oil and anything they can get from Ukraine to recoup the money the US put into Ukraine.


• US Secretary of State Rubio told Ukraine’s Foreign Minister that US President Trump remains committed to ending the conflict in Ukraine.


• 
  US Treasury Secretary Bessent said an economic partnership will protect the Ukrainian people and the US taxpayer, while he added that Ukraine’s economic future in peace can be more prosperous than at any other point and a partnership with the US will ensure this prosperity. Furthermore, Bessent said the US-Ukraine partnership proposal is for revenue received by Ukraine from natural resources, infrastructure and assets to be allocated to a fund focused on reconstruction which the US will have the rights over investments, according to FT. It was separately reported that Bessent said he is quite hopeful when asked if he expected a minerals deal with Ukraine this week.
  


• 
  US President Trump’s envoy Witkoff said there be an expectation that US companies may do business in Russia if a peace deal is reached in the Russia-Ukraine war, according to CBS News.


• 
  Russian President Putin convened a meeting of his security council and discussed relations with post-Soviet states at the meeting, while he received reports from Foreign Minister Lavrov’s recent trips and asked him to share them with the security council, according to TASS. It was also reported that Putin said boosting Russia’s armed forces and meeting the needs of troops fighting in Ukraine are key strategic priorities.
  


• Russian sovereign wealth fund chief Dmitriev was appointed Special Envoy on International Economic Cooperation and his new mandate will include ties with the US.


• 
  Russian Deputy Foreign Minister Ryabkov said a second meeting between representatives of Russia and the US is planned for the next two weeks and said that Russia will hold talks with the US to address irritants in bilateral relations, according to TASS.


• Russian Foreign Minister Lavrov is to visit Turkey on Monday and will discuss a range of topics including recent US talks on the Ukraine war and how Turkey can contribute.


• Russian Defence Ministry said Russian forces captured the villages of Ulakly and Novoandriivka in eastern Ukraine’s Donetsk region.


• Greek PM Mitsotakis told Ukrainian President Zelensky that it is up to Ukraine to decide on the peace framework acceptable to it and nothing can be decided without Ukraine.


• Poland’s President Duda told US President Trump that US presence in Poland and central Europe should be boosted.


• Hungary's PM Orban said Ukraine will never be a member of the EU against Hungary’s interests.


• EU Council President Costa said they decided to convene a Special European Council regarding Ukraine and EU defence on March 6th.


• Canadian PM Trudeau and US President Trump spoke on Saturday in which they discussed the war in Ukraine and combating fentanyl.

OTHER

• China’s Defence Ministry spokesperson said Australia is hyping up China’s naval drill.

ASIA-PAC

NOTABLE HEADLINES

• 
  China is to further deepen rural reforms and advance rural revitalisation, while it will monitor and regulate pig production capacity to promote steady growth and will consolidate the results of soybean expansion, and expand rapeseed and peanut production. China is to improve the reward and subsidy systems for major grain-producing and increase support for large grain-producing counties. Furthermore, China will support the development of smart agriculture and expand application scenarios of technologies, while it will use monetary tools to encourage financial institutions to increase funding for rural revitalisation and will encourage local governments to pilot special loan interest subsidies for grain and oil crop cultivation, according to Xinhua.


• 
  Shein’s profit slumped in a fresh challenge to long-planned London IPO with its 2024 net profit down almost 40% to USD 1bln although FY sales rose 19% Y/Y to USD 38bln, according to FT.


• 
  A report on Friday stated that a new coronavirus with pandemic potential was discovered in China, according to Daily Mail.

EU/UK

NOTABLE HEADLINES

• 
  Exit poll by ARD showed Germany’s conservative CDU party won the election with 29% and the far-right AfD was in second place with 20%, while German Chancellor Scholz’s SPD was in third place with 16%, Greens were seen to win 13.5%, the left party were at 8.5%, FDP at 4.9% and BSW party at 4.7%. Europe Elects later reported the preliminary result showed CDU/CSU-EPP at 34% (+10), AfD-ESN at 23% (+13), SPD-S&D at 14% (-12), GRÜNE-G/EFA at 8% (-7), LINKE-LEFT at 6% (+1), BSW-NI at 4% (+4) and FDP-RE at 4% (-7).
  


• 
  German CDU party leader Merz said they have won the election and are aware of the scale of the challenge ahead, while he added that it is important to create a government as soon as possible and that Germany must be present in Europe again. Merz also commented that he will try to form a government that represents the whole country and has always said no question of a coalition with AfD, as well as noted that forming a government will be difficult but he still hopes they will have formed a government by Easter. Furthermore, Merz said the priority is that the EU stand together and become independent from the US, as well as noted it is clear that the future of Europe is a matter of indifference to US President Trump.
  


• Austrian conservatives, socialists and liberals are prepared to form a government.


• 
  ECB’s Villeroy reaffirmed that the ECB’s Deposit rate should be at 2% by this coming summer and said that European banking sector consolidation is generally speaking, necessary to have European banks that can compete at a global level.


• 
  Hungary's PM Orban said they are to exempt mothers of two or three children from income tax and said this will be a huge expense but the budget deficit and debt will decline, while he added the government is ready to impose food price caps unless talks with retailers on keeping prices under control succeed.
  


• The Vatican said Pope Francis’s condition remains critical and has not had further respiratory crises on Sunday but has mild renal insufficiency.

23 Feb 2025 - 22:29- ForexAsian Research- Source: Newsquawk