ASIA: Asian stocks rose slightly, but Japan slumped. The biggest news in Asia was the victory of Japan’s prime minister Naoto Kan against challenger Ichiro Ozawa. Mr. Ozawa was pushing a far more aggressive stance vs. the appreciating yen and in regards to stimulus, thus we feel Mr. Kan’s win says much about Japan, finally, rejecting the same old failed economic strategies it employed in the past. The yen has hit a 15-year high and is currently around 83.31 per U.S. dollar, and this seems to have unnerved Japanese stocks.
New loans in China for August came in slightly higher than expected, hitting 545.2 billion yuan. Chinese property stocks lost ground yet again today, with China Vanke and Poly Real Estate both down, as concerns about further property tightening measures continue.
Also, I think it’s worth stepping back and noticing how South East Asia has outperformed better known markets such as Hong Kong lately. Indonesia is near a record high, Thailand is soaring, even as many other markets remain below their past peaks. See more in the focus charts below.
EUROPE: Is easing back in early trade. Germany’s ZEW survey of economic sentiment fell substantially in September, hitting a reading of -4.3 vs. 14 previously. It appears to have missed expectations by a wide margin.
MACRO: The dollar continues to drop and the euro is right below $1.29. Gold has popped back above $1,250.
U.S. FUTURES: Are falling, after yesterdays big rally. Watch for retail sales data at 8:30 AM ET and business inventories at 10:00 AM.