Yen hits 1-week high as US Treasuries extend gains

*Asian Market Update:* Yen hits 1-week high as US Treasuries extend
gains; China stocks sinks on hawkish PBoC rhetoric and overheating
lending activity

!! Economic Data !!
*- (JP) JAPAN DEC DOMESTIC CGPI M/M: 0.4% V 0.2%E; Y/Y:* 1.2% V 1.0%E
(highest since Nov 2008)
*- (CH) CHINA CONFERENCE BOARD NOV LEADING ECONOMIC INDEX:* 0.5% V
0.9% PRIOR (4-month low)
*- (KS) SOUTH KOREA DEC EXPORT PRICE INDEX M/M: 3.1% V 1.2% PRIOR;
Y/Y: 4.3% V 1.9% PRIOR; IMPORT PRICE INDEX M/M: 4.7% V 2.1% PRIOR;
Y/Y:* 12.7% V 8.2% PRIOR
*- (SI) SINGAPORE NOV RETAIL SALES M/M: 0.6% V 0.9%E; Y/Y: -2.4% V
-2.4%E; EX AUTO:* 5.4% V 5.8%E

!! Markets Snapshot (as Of 12:00amET) !!
- Nikkei225 -0.6%
- S&P/ASX +0.2%
- Kospi +0.4%
- Taiex -0.1%
- Shanghai Composite -1.0%
- Hang Seng +0.2%
- Mar S&P Futures +0.1% at 1,282
- Mar Gold +0.7% $1,377/oz
- Feb Crude oil -0.3% $91.09/brl
- Mar Copper -0.3% at $4.36

!! FX USD Majors Session Range !!
*- EUR/USD:* 1.3325-1.3365
*- GBP/USD:* 1.5820-1.5850
*- USD/CHF:* 0.9635-0.9655
*- USD/CAD:* 0.9885-0.9905
*- AUD/USD:* 0.9950-0.9995
*- NZD/USD:* 0.7725-0.7695
*- USD/JPY:* 82.55-82.85

!! Overview/Top Headlines !!
- Asian equity markets are trading mixed in the final session of the
week in the wake of another impressive bond auction out of the EU
periphery soured by a 10-week high in weekly jobless claims out of the
US. A second consecutive rise in claims weighed on risk appetite as
traders took some profits ahead of the US CPI and retail sales data.

On the corporate side, uncertainty regarding the financial sector
ahead of the JPMorgan earnings clouded a strong result from tech
heavyweight Intel, where rising CAPEX and higher margins helped shares
gain over 2% afterhours. European and commodity currency majors traded
sideways, consolidating US session gains increasingly perceived as
short-covering. *Likewise, flight to the safety of US treasuries
weighed on benchmark yields, as 10-year's fell below 3.30% afterhours
and USD/JPY hit a 1-week low below ¥82.50.*

- Shanghai Composite is the biggest decliner in the region, as
exporters take note of a third consecutive session of post-reval
record high in Chinese Yuan.* Recall, China Pres Hu is preparing to
meet with US Pres Obama next week, with Treasury Sec Geithner already
chiming in about CNY strengthening being too slow. Additionally,
*hawkish commentary from PBoC Assistant Gov Li Dongrong warning China
is facing rising inflation expectations* raised some speculation the
central bank could tighten policy once again. Finally, a *China Daily
report citing interbank data saw China's top 4 banks lending about
CNY240B in the first 10 months of January v CNY160B for all of
December.* A similar dynamic was on display last January (2010), when
sharply high lending activity spurred the first RRR hike out of 6 for
the remainder of 2010 - PBoC's first policy tightening since 2008.

!! Speakers/Geopolitical/In The Press !!
- (SI) Singapore implements 4th round of property cooling measures
including an increase in stamp duty to a max of 16% v 3% prior
*- US Defense Sec Gates:* China's cyber and anti-satellite advances
may present a challenge to operations of US forces in the Pacific
*- (EU) ECB's Trichet:* Will not allow a long-term rise in inflation;
Expects inflation to fall below 2% by the end of the year; Italy and
Spain should maintain credible fiscal policies - press interview

!! Equities !!
*- Lenovo: Company boosted its market share for the 5th consecutive
quarter to 9.7%; 2010 shipments rose 37.3% y/y to about 34M PCs on
rising enterprise sales and expansion in retail - South China Morning
Post*
*- Woolworths:* Continues to struggle making deliveries to Queensland;
May take weeks to return supplies to normal levels
*- Hyundai Motor:* Expected to sign a deal to acquire Hyundai
Engineering & Construction later today - Korean Press
*- Sony:* To debut 3D camcorders in April with 10x optical zool and
64GB external memory priced around ¥30K - Nikkei News
- (US) According to NPD, 2010 spending on videogames was $15.4-15.6B,
flat to down 1% y/y
*- Sigma Pharma:* Chairman: Expects to have improved financial
position after selling pharma unit to Aspen; Road closures from
flooding has impacted some deliveries
*- INTC: Reports Q4 $0.59 v $0.53e, R$11.46B v $11.4Be; +2.1%
afterhours*
*- CSTR: Reports prelim Q4 $0.65-0.69 v $0.84e, Rev $391M v $425Me
(previously guided Q4 $0.79-0.85, R$415-440M on 10/28); -24.4%
afterhours*
*- SBIB:* Has put itself up for sale; Sale expected to be announced
next week; Expected to go for $8.00/share (closed at $7.48), $825M -
US Financial Press citing sources; +8.3% afterhours

!! FX/Fixed Income/Commodities !!
*- (CH) PBoC sets yuan mid point at 6.5896 v 6.6046 prior close (new
Yuan high since 2005 revaluation)*
*- GLD:* SPDR Gold Trust ETF daily holdings fall by 6.4 tons to
1,265.1 tons (multi-month lows)
- (CH) According to People's Daily, wheat production areas in China's
northern areas of Shandong region are suffering droughts with no rain
for about 4 months
Source: Fxstreet.com