Tonight US Mar Retail Sales, CA BoC rate decision

Asia Market Update: Markets quiet until fresh WH-induced volatility; CN pre-tariff data outperforms; JP-US tariff negs tomorrow; Tonight US Mar Retail Sales, CA BOC Rate Decision.

General trend

- Markets were enjoying another quieter day with lower volatility, until after the NY markets closed when the US govt informed Nvidia it requires a license for export to China, with Nvidia now expecting $5.5B charges in Q1:2026 associated with its H20 chips.

- This was compounded just minutes later when US Pres Trump signed an Exec Order to probe critical minerals ahead of potential tariffs, due to "national security risks”.

- Nvidia collapsed -6.3% after hours, with Japanese supplier Advantest opening down -7% and other chip relateds Tokyo Electron -1.3%, SK Hynix -3.0%, Samsung -3.0%. Conversely, China chip-makers Hua Hong +2.7%, SMIC +2.4%.

- US equity FUTs reopened in Asia down ~1%. Hang Seng underperformed -2.6%.

- Prior to this in late Asian trading last night China halted orders for Boeing jets and aircraft-related equipment and parts. [Note that China has taken this action before in times of US-China stress, such as the 2018-2019 trade war, using halts as leverage within broader diplomatic negotiations]. Boeing-3.1% vs Airbus +1.4%. The move came as China swapped out its Vice Commerce Minister and replaces top trade negotiating official. [Note that ex-China social media spoke of Pres Xi plans to "aggressively counter" US tariffs being reportedly leaked].

- Japan representative Akazawa confirmed to be negotiating with US on tariffs from tomorrow in the US, while BOJ Gov Ueda said the BOJ may need to respond to US tariffs if the economy worsens, as the "bad scenario" of US tariffs is worse that the BOJ had anticipated.

- Also on the trade front WSJ appeared to confirm what a lot of people already thought by saying that the US was using tariff negotiations to 'isolate China', with the plan said to be the brainchild of Treas Sec Bessent.

- China data dump for March perhaps marked an inflexion point, as these are the last major economic figures released from China prior to the imposition of US tariffs on April 2nd. Retail Sales and Industrial Production significantly outperformed expectations, while yearly GDP slightly outperformed even as m/m was slightly underperformed. NBS Stats Bureau said the unfavorable impact from international environment on China's economy is deepening but that macro-economic policies will ‘become more proactive this year’. CN/HK stocks not helped by the data.

- Spot gold rose to fresh record high of $3,286/oz.

- US equity FUTs -1.3% to -2.2% during Asian trading.

Looking ahead (Asian-weighted news, using Asian time zone)

- Wed 15th (Wed eve US Mar Retail Sales, CA BOC Rate Decision).

- Thu 16th NZ Q1 CPI, JP Mar Trade Balance, KR Rate Decision, AU Jobs, (Thu eve ECB Rate Decision).

- Fri 17th JP Mar National CPI.

- Sat 18th CN Mar FDI.

Holidays in Asia this week

- Mon Apr 14th India, Thailand.

- The Apr 15th Thailand.

- Thu Apr 17th Philippines.

- Fri Apr 18th Australia, Hong Kong, India, Indonesia, New Zealand, Philippines, Singapore.

Headlines/economic data

Australia/New Zealand

- ASX 200 opens -0.1% at 7,756.

- Australia Mar Westpac Leading Index M/M: -0.1% v +0.1% prior [first decline in 7 months].

- Australia sells A$1.0B v A$1.0B indicated in 3.50% Dec 2034 bonds: Avg Yield: 4.2878% v 4.4640% prior; bid-to-cover: 3.99x v 3.73x prior.

- New Zealand Mar Non Resident Bond Holdings: 61.9% v 61.8% prior.

- New Zealand govt to plan review into telecommunications regulations - update.

- New Zealand Fin Min Willis: RBNZ has agreed to new five-year reduced funding arrangement; Avg Opex to be NZ$150M in coming year, -25% y/y.

- Fonterra Global Dairy Trade Auction Dairy Trade price index: +1.6% v +1.1% prior.

China/Hong Kong

- Hang Seng opens -0.7% at 21,316; Shanghai Composite opens flat at 3,267.

- CHINA Q1 GDP Q/Q: 1.2% V 1.4%E; Y/Y: 5.4% V 5.2%E.

- China Mar industrial production Y/Y: 7.7% V 5.9%E.

- China Mar Retail Sales Y/Y: 5.9% V 4.3%E.

- China Mar YTD fixed urban assets Y/Y: 4.2% V 4.1%E.

- China Mar YTD Property Investment Y/Y: -9.9% v -9.9%e.

- China Mar Surveyed Jobless Rate: 5.2% v 5.3%e.

- China Mar New Home Prices M/M: -0.1% v -0.1% prior.

- China NBS Official: To 'fully stimulate' the vitality of all businesses - comments on Mar data.

- US said to plan to use tariff negotiations to 'isolate China', in a plan pitched by Treas Sec Bessent - WSJ, citing sources.

- China issues 'action plan' to promote service consumption which covers areas including catering, tourism and leisure.

- China names Li Chenggang as Vice Commerce Minister, replacing Wang Shouwen; replaces top trade negotiating official - US financial press.

- (US) President Trump: May want countries to choose between the US and China.

- PDD Unit Temu said to cut ad spending on Google and Meta as tariffs take their toll - The Information.

- JPMorgan CEO Dimon urges US to engage with China; Deleveraging in UST maybe somewhat over for now – FT.

- China Premier Li Qiang: Reiterates urge for greater efforts to promote consumption; There is relatively lots of room for Chinese property market development.

- Boeing: CHINA REPORTEDLY ORDERS HALT TO BOEING JET DELIVERIES – PRESS [overnight update].

- Follow Up: China shadow bank Zhongrong International Trust Co. that oversaw $108B faces liquidation after its two state-appointed custodians concluded the firm is insolvent – press [overnight update].

- China PBOC sets Yuan reference rate: 7.2133 v 7.2096 prior.

- China PBOC Open Market Operation (OMO): Injects CNY105B in 7-day reverse repos; Net drains CNY15B v drains CNY3B prior.

Japan

- Nikkei 225 opens -0.1% at 34,270.

- Japan Feb Core Machine Orders M/M: 4.3% v 1.2%e; Y/Y: +1.5% v -0.9%e.

- Japan Econ Revitalization Min Akazawa: Reiterates will negotiate (with US on tariffs) with Japan's interest in mind - financial press.

- Follow up: Japan reportedly affirmed to Not consider extra budget measures during current Diet session - Nikkei.

- Japan BOJ Gov Ueda: May need policy response to "bad scenario" of US tariffs, but will decide appropriately in line with developments [When asked about BOJ response if tariffs put downward pressure on Japan's economy] - Sankei.

- Japan financial regulator (FSA) considering "distribution-type" NISA savings account for seniors – Nikkei.

- Bank of Japan (BOJ) announcement related to outright bond buying operations: Leaves bond buying amounts unchanged.

- Japan Econ Revitalization Min Akazawa: Looking for complete 'retraction' of extra US tariffs; Will seek what is most effective for national interest; To visit Washington between Apr 16-18th [overnight update].

Korea

- Kospi opens -0.2% at 2,472.

- South Korea Mar Import Price Index M/M: -0.4% v -1.0% prior; Y/Y: 3.4% v 4.3% prior.

- South Korea Finance Min: Finance Min Choi to meet with US Treasury Sec Bessent next week.

- South Korea Fin Min Choi: Korea will try to delay reciprocal tariffs as much as possible by negotiations with the US [overnight update].

- S&P affirms South Korea sovereign rating at 'AA'; Outlook stable [overnight update].

- South Korea companies [Posco Holdings, Hana Securities and Shinhan Bank] said to delay bond sales – US financial press [overnight update].

Other Asia

- Thailand Fin Min Pichai: Reiterates to import more US natural gas over next 5 years; Signed contract to import >1Mt of LNG for next year - financial press.

- China Pres Xi: Deeper high-level strategic cooperation with Malaysia serves common interests of both countries - Chinese state media.

- INDIA MAR CPI Y/Y: 3.3% V 3.5%E (slowest annual pace since Aug 2019) [overnight update].

- Singapore to hold general elections on May 3rd – press [overnight update].

- Polling Day will be on May 3, and Nomination Day will be on April 23 [overnight update].

- General elections will elect 97 members to the Parliament of Singapore across 33 constituencies. [overnight update].

-The elections will be the 19th in Singapore since the first general election in 1948 and the 14th since its independence in 1965, with it being PM Lawrence Wong’s first as PM. [overnight update].

- In the 2020 general election, the ruling People’s Action Party got 61.24% of the votes, and won 83 out of 93 parliamentary seats [overnight update].

North America

- *(US) Trump Admin signs Exec Order to open Section 232 probe of critical minerals ahead of potential tariffs, due to "national security risks" posed by US reliance on the minerals and derivative products - press.

- Nvidia US government informed Company it requires a license for export to China; Expects $5.5B charges in Q1:2026 associated with H20 .products - filing.

- (BR) Brazil and China in talks to address the 'gap' left by US tariffs, with a focus on Brazil exports to China - SCMP.

- (US) Trump signs Executive Order pushing changes to Medicare drug price negotiation process and lower drug prices - press.

- (US) Fed Discount Minutes: No sentiment was expressed by the Board at March 19th meeting for changing the primary credit rate at this time.

- (CA) Canada Mar Annualized Housing Starts: 214.2K v 238.8Ke.

- (US) APR EMPIRE MANUFACTURING: -8.1 V -13.5E; Notes firms turned pessimistic about the outlook for the first time since 2022; Input and selling price increases picked up to the fastest pace in more than two years.

- (US) MAR IMPORT PRICE INDEX M/M: -0.1% V 0.0%E; Y/Y: 0.9% V 1.4%E.

- (CA) CANADA MAR CPI M/M: 0.3% V 0.7%E; Y/Y: 2.3% V 2.7%E.

- (MX) Mexico Pres Sheinbaum: Mexican Govt negotiating agreements with Northern states to determine how much water they can send to the USA under bilateral agreement.

- (CA) PM Carney: Had a lot of conversations with global automaker CEOs.

- (IR) US Pres Trump discusses ways to support US-Iran nuclear talks with Oman's Sultan Bin Tariq - Omani state media.

- (US) Judge scraps US rule capping credit card late fees at $8 - press.

- Venture Global Plaquemines LNG reportedly coming to market with first junk bond offering in two weeks; Yields said to be in mid 7% range - press.

Europe

- (BE) Belgium govt preparing to increase borrowing and implement "painful" cuts to reach NATO defense spending goal - FT.

- (UK) National Energy System Operator (NESO): Has the right tools to manage UK network during low demand periods - financial press.

- (EU) EU said to expect US tariffs to remain in place as discussions are making little progress - press.

- (UR) Pres Zelenskiy: Talks with US on minerals deal were positive; More meetings to come.

- (IL) Israel Mar CPI M/M: 0.5% v 0.3%e; Y/Y: 3.3% v 3.2%e.

- (ES) Spain Econ Min Cuerpo: US Treasury Sec Bessent says he wants to deal with EU regarding tariffs.

Levels as of 00:20 ET

- Nikkei 225 -1.6%, ASX 200 +0.1%, Hang Seng -2.6%; Shanghai Composite -0.6%; Kospi -1.1%.

- Equity S&P500 Futures -1.4%; Nasdaq100 -2.1%; DAX -0.6%; FTSE100 -0.3%.

- EUR 112.81-1.1350; JPY 142.47-143.28; AUD 0.6323-0.6358; NZD 0.5887-0.5922.

- Gold +2.1% at $3,305/oz; Crude Oil -0.6% $60.96/bbl; Copper -0.9% at $4.5735/lb.