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DAILY US OPENING NEWS - 09/04/12

· Chinese CPI (Mar) Y/Y 3.6% vs. Exp. 3.4% (Prev. 3.2%)

· The Greek parliament is to be dissolved on Wednesday according to a Greek government spokesman.

Market Re-Cap

Last Friday saw the release of a below-expected US Non-Farm Payrolls figure, causing flight to safety in particularly thin markets, with equity futures spiking lower and US T-notes making significant gains.

Data from this week so far in Asia has shown Chinese CPI is still accelerating, coming in above expectations at 3.6% against an expected 3.4% reading.

Looking ahead in the session, there is very little in the way of data due to the reduced Easter session in the US and the European and UK markets closing for Easter Monday.

Asian Headlines

Chinese CPI (Mar) Y/Y 3.6% vs. Exp. 3.4% (Prev. 3.2%)

Chinese PPI (Mar) Y/Y -0.3% vs. Exp. -0.3% (Prev. 0.0%) (RTRS)

Japanese Current Account Total (Feb) M/M 1177.9bln vs. Exp. 1120.0bln (Prev. -437.3bln)

Japanese Eco Watchers Survey: Current (Mar) M/M 51.8 vs. Exp. 46.5 (Prev. 45.9)

Japanese Eco Watchers Survey: Outlook (Mar) M/M 49.7 (Prev. 50.1) (RTRS)

The Bank of Japan is expected to state that the nation's economy is generally flat, the same assessment as the previous month, in its monthly report for April according to reports. (Nikkei/Jiji) Additionally, it was reported on Friday that Japanese PM Noda and BoJ Governor Shirakawa met with market sources, suggesting further government pressure for the BoJ to conduct further easing.

Former BoJ deputy governor Iwata said the BoJ should conduct more bond buying to meet their inflation target and buy JGBs with longer maturities, the BoJ should also only raise their inflation target once 1% inflation is in sight. (RTRS)

US Headlines

The Obama administration wants Fannie Mae and Freddie Mac to start reducing loan balances for troubled borrowers, but with safeguards to prevent them from purposely defaulting to obtain relief. (NASDAQ:CNBC) Housing and Urban Development Secretary Shaun Donovan laid out the case for a program with such checks and balances to convince the FHFA to provide more mortgage aid.

EU and UK Headlines

The Greek parliament will be dissolved on Wednesday according to Greek government spokesman Kapsis. (eKathimerini)

The Spanish finance minister de Guindos said an EU bailout is not on the table, and Spain is to present a stability programme in the coming days, which will include forecasts from 2013. (RTRS) He added that the current market "jitters" reflect concerns on EU growth in general but the recent move in Spanish 10-year yields and spreads cannot be maintained for a long time at these levels.

The IMF said if the Portuguese recession turned out to be deeper than initially projected then "chasing" the 2012 deficit targets may not be the best policy. However, the IMF noted that this deficit target does remain within reach and Portugal's current bailout is sufficient. Furthermore, the prospect of Portugal regaining access to the markets could be possible in 2013. (RTRS)

ECB funding to Italian banks rose by 40% to EUR 270bln in March, the highest on record, according to data from the Bank of Italy. (RTRS) Separately, Italian PM Monti said that he does not rule out using a confidence vote to help push the country's labour reform through parliament, adding that he is confident the public supports the reforms. Furthermore, the Italian PM believes the country's political parties will continue to support the government.

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Greek PM Papademos said Greece will announce by April 20 plans to recapitalise its banks hit hard by the country's debt restructuring agreement. (Sources/Der Spiegel) Elsewhere, Greek Pasok Party leader Venizelos said Euro-zone countries have promised financial aid to Greece until the country can access funding on the market again.

Spain is targeting its education and health services in its next round of reforms, amid rising concerns over its ability to handle its debts, and fears that the stubborn euro crisis is flaring up again. (Xinhua)

FX

EUR remains weak, carrying across the lack of confidence from last week, however with Japan and China holding official talks concerning IMF funding, the currency may see some support. The price action will be limited due to market holidays across Europe and the UK and a reduced session in the US.

Currency

EURUSD

GBPUSD

USDJPY

Level

1.3072

1.5857

81.35

Change (pips)

-0.0024

-0.0014

-0.2900

COMMODITIES

WTI and Brent crude futures are showing limited price action due to the reduced sessions in the US and the market holiday in Europe and the UK.

North Korea Update:

· Pyongyang has said it will launch the satellite for peaceful scientific research between April 12 and 16.

· The launch is to mark the 100th anniversary on April 15 of the birth of founding leader Kim Il-Sung.

· The country is pressing ahead with a rocket launch in defiance of a UN resolution by moving all three stages of a long-range rocket into position for a launch.

· The country is also preparing a third nuclear weapons test, South Korean news reports said on Sunday, a move bound to scare neighbours and infuriate the West.

· Satellite images show digging of a new tunnel at a site where the country conducted nuclear tests in 2006 and 2009 according to an unidentified intelligence official.

· It was also reported that the foreign ministers of Japan, China and South Korea began talks on Sunday to increase diplomatic pressure on North Korea to drop its plan to launch a rocket carrying a satellite.

Iran Update:

· Iranian nuclear talks will resume on April 14th in Istanbul according to EU policy chief Ashton.

· The US and its European allies plan to demand the immediate closing by Iran and ultimate dismantling of a recently completed underground nuclear facility near the city of Qum.

· The allies will also call at upcoming negotiations for a halt in the production of uranium fuel that is considered just a few steps from bomb grade, and the shipment of existing stockpiles of that fuel out of the country.

· The Iranian foreign minister Salehi said Iran would not agree to world powers imposing pre-conditions ahead of the resumption of nuclear talks later this week.

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Commodity

WTI Nymex

OTC Spot Gold

 

Level

101.64

1642

 

Change (NYSEARCA:USD)

-1.67

5.58

 

**Note: For commodities news in detail, refer to the RANsquawk Daily Energy Commentary report.

LOOKING AHEAD

Economic Releases

CDT

BST

 

DATA

EXP

PREV

0930

1530

CA

Business Outlook Future Sales (Q1) Q/Q

 

-4.00

0930

1530

CA

BoC Senior Loan Officer Survey (Q1) Q/Q

 

-6.3

 

Speakers

0800

1400

US

President Obama, Brazilian President Rousseff at White House

0930

1530

WLD

IIF hosts press conference on IMF Spring Meetings

1700

2300

US

Fed's Bernanke speaks at Stone Mountain, Georgia conference

 

Auctions

1000

1600

US

Fed's Outright TIPS Sale Jul'12 - Jan'15 (USD 1.0-1.5bln)

1030

1630

US

USD 31bln 3-Month and USD 29bln 6-Month Bill Auctions

 

Earnings

UK

N/A

EU

N/A

SZ

N/A

US

N/A

Prices taken at 1243BST

**Note: Market Closed UK, Australia, EU, China, New Zealand

Monday 9/04/12: Easter Monday

Floor Trade: CME/CBOT (Regular close), NYSE (Regular close), NYMEX (Regular close)

Electronic Trade: CME Globex - Equity (Regular close), Interest Rate (Regular close), FX (Regular close), NYMEX (Regular close), Eurex (Closed), NYSE LIFFE (Closed)

The RANsquawk desk will be open Easter Monday - 9th April (Open 1200BST/0600CDT - 2130BST/1530CDT)

'Market talk' - Signifies information that has not been formally tested through traditional journalistic channels and therefore is to be treated as unsubstantiated. Any interpretation of the talk is taken at the readers own risk and is a representation of the rumours within the market place and never generated by ourselves.