Halister News

(Bloomberg) -- Following are forecasts for today’s U.S. economic releases as compiled by Bloomberg News.

• SPCS 20 0.5% m/m; range 0% to 0.9% (17 estimates)
• SPCS 20 5.9% y/y; range 5.4% to 6.2% (17 estimates)
• • "Mortgage rates are off from last year’s trough and home prices have been grinding higher. A severe shortage of inventory appears to be one of the major factors behind the recent -- yet still modest -- acceleration in home-price growth": Bloomberg Intelligence
  • In March, the 20-city property values index rose 5.9 percent from a year earlier, matching February as the most since July 2014

(Bloomberg) -- Charges were already expected, but they test coalition loyalty in a scenario of low presidential political capital and with formal questioning regarding the execution of the mandate, says Rafael Cortez, a political analyst at Tendencias Consultoria.

• There will be an increase in uncertainty due to the fate of the president and to the progress of reforms
  • Coming days should have high volatility
  • How long it will last will depend on signals that economic policy continues in the right direction and govt’s ability to take steps of normality
• Pension reform should be almost paralyzed in the short term, pending the solution to political crisis
  • Prospect for reforms is negative
  • Labor reform should advance in Senate to avoid that uncertainty becomes aversion to risk and market starts having positive view on a Temer exit
• From the political point of view, work will now be to do strategic analysis and identify who can actually support Temer’s permanence
  • Political feasibility for government strategy is deteriorating
• Government can get support to veto instauration of proceedings against Temer
• NOTE: Brazil’s President Michel Temer was charged with corruption by the chief prosecutor on Monday evening

(Bloomberg) -- Google was fined EU2.42 billion by European Union regulators for skewing search results in its own favor to boost its shopping search service.

• Google “abused its market dominance” by systematically favoring its own comparison-shopping service in its general search results, European Commission says in statement in Brussels Tuesday
• Fine sets new record for monopoly abuse penalty
• Google is given 90 days to end the abusive behavior “or face penalty payments of up to 5 percent of the average daily worldwide turnover of Alphabet, Google’s parent company,” EU says
• EU opened search case in 2010; it’s also probing Google’s Android mobile- phone software and AdSense online advertising service
• SEE: Google Execs Hunker Down for Fight With EU as Fines Loom

To contact the reporters on this story: Aoife White in Brussels at awhite62@bloomberg.net; Stephanie Bodoni in Luxembourg at sbodoni@bloomberg.net

--PETER CHAPMAN

(Bloomberg) -- China’s yuan led gains in emerging Asian currencies amid speculation of central bank intervention and a decline in the dollar. Other emerging currencies were mixed before Federal Reserve Chair Janet Yellen speaks in London. The MSCI EM Asia Index of shares fell. Chinese Premier Li Keqiang said the economy maintained steady growth in the second quarter, and China will be able to keep expanding in a reasonable range. “Recent monetary tightening in China should support the yuan,” says Masashi Murata, a currency strategist at Brown Brothers Harriman in Tokyo. “Li’s comment on China meeting growth goals also might support the yuan.” CHINA:

• Offshore yuan jumps 0.6%, onshore yuan rises 0.4%
• At least two big Chinese banks were seen selling dollars against the yuan onshore, according to two traders who asked not to be identified
  • Some traders in North Asia said they were only seeing flows from leveraged and bank accounts
• 10-year government bonds gain, Shanghai Composite Index rises 0.2%
• PBOC weakens yuan daily reference rate by 0.11% to 6.8292 per dollar, least since May 31
  • Skips open market operations for third day
• Aberdeen Asset Management is waiting for a bigger correction in longer-dated China onshore bonds before adding positions, according to Edmund Goh, a fixed-income investment manager
• Both short- and long-ends of China’s onshore bond curve are attractive, according to Freddy Wong, a portfolio manager at Fidelity
• May industrial profits rise 16.7%, vs 14% in April

SOUTH KOREA:

• Won little changed after dropping as much as 0.2%
• KOSPI share index gains 0.1%
• “Won is long-biased today due to exporters’ selling dollars ahead of the quarter end,” says Seung Ji Jeon, currency analyst at Samsung Futures
  • “All eyes are on Yellen’s comments tonight and the wait-and-see mood is giving support to USD/KRW around the 100-DMA”
• Despite rising approval ratings, President Moon’s fiscal stimulus package has so far gone nowhere in parliament, underscoring the challenges he faces in enacting his economic agenda without a majority
• 10-year bond yield falls 1bp to 2.12%

INDIA

• Rupee gains a second day as foreign funds buy Indian stocks and bonds; S&P BSE Sensex retreats 0.7%
• Demand for local assets is supporting the rupee, says Anindya Banerjee, associate vice president for currencies derivatives at Kotak Securities
  • Currency “would have appreciated much more” if not for the RBI’s dollar purchases aimed at boosting FX reserves, he says
  • Reserves rose $799m to $382b in the week to June 16
• Overseas holdings of Indian govt and corporate debt rose for a 22nd day on Friday, longest stretch in NSDL-compiled Bloomberg data going back to 2011
• Foreign funds bought net $78.9m rupees of local stocks on June 22, taking total inflows for the month to $333.4m
• Yield on 6.79% bonds due May 2027 drops 1bp to 6.46%

TAIWAN:

• Taiwan dollar, TAIEX Index of shares both little changed
• Economy will expand 2.25% in 2Q, according to Bloomberg survey of 28 economists conducted from June 19 to June 26
• UBS raises year-end Taiex forecast to 10,600 from 9,850
  • Strength in liquidity due to equity inflows from abroad and optimism for next iPhone means stock market may rise in short term, analyst William Dong writes in note

THAILAND:

• Baht gains with SET Index
  • Overseas investors sold net 79m baht ($2.3m) of local bonds Monday, first net outflow since June 16, according to TBMA data
  • Sold net $19.8m of local equities, taking sales this month to $167.6m: exchange data
• BOT will probably hold policy rate at 1.5% on July 5, Tim Leelahaphan, Thailand economist in Bangkok at Maybank Kim Eng Securities, wrote in Monday note
  • Negative real interest rates may force BOT to increase the policy rate before year-end
• Yield on 2.125% govt bond due December falls 2bps to 2.374%

PHILIPPINES:

• Philippine peso drops 0.1% as markets reopen after Monday’s holiday
• USD/PHP rises to 50.30, trades in 50.185 to 50.30 range
• Investors are undeterred by clashes between govt troops and IS-linked militants in Marawi city and declaration of martial law in Mindanao, Trade Secretary Ramon Lopez says
• ATR Asset Management says Philippines has a “very good story” as benefits from President Duterte’s economic program are shaping up
• Lower inflation view of Bangko Sentral ng Pilipinas seem to suggest higher probability of no change in monetary policy this year, according to note from Bank of Tokyo-Mitsubishi UFJ

RESEARCH:

• Goldman Sachs Asset Management is taking a more conservative view on emerging-market currencies as momentum seems to be easing for global growth outlook, positions look stretched and commodity prices have weakened, according to June 23 report received Tuesday

Above are market moves and news from emerging Asian economies. For Australia, please see Inside Australia. For Japan, see Inside Japan. To contact the reporter on this story: Subhadip Sircar in Mumbai at ssircar3@bloomberg.net To contact the editors responsible for this story: Tan Hwee Ann at hatan@bloomberg.net Nicholas Reynolds