Asian Market Update: February 13, 2012

Risk appetite creeps back into the markets on positive Greece news; Japan contracts

Economic Data

(JP) JAPAN Q4 PRELIMINARY GDP Q/Q: -0.6% V -0.3%E (biggest contraction since Q1); NOMINAL GDP Q/Q: -0.8% V -0.7%E; GDP ANNUALIZED: -2.3% V -1.3%E; 2011 GDP -0.9% (first decline in 2 years)

(AU) AUSTRALIA DEC HOME LOANS M/M: 2.3% V 1.8%E (7-month high); OWNER-OCCUPIED HOME LOAN VALUE: 2.0% V 2.4% PRIOR; INVESTMENT LENDING: 7.5% V 2.7% PRIOR

(JP) JAPAN DEC TERTIARY INDUSTRY INDEX M/M: 1.4% V 0.8%E (6-month high)

(IS) Israel Jan Trade Balance: -$2.2B v -$1.3B prior

Markets Snapshot (as of 05:30GMT)

Nikkei225 +0.6%

S&P/ASX +0.9%

Kospi +0.7%

Taiwan Taiex +0.6%

Singapore Straits Times +0.3%

Shanghai Composite +0.3%

Hang Seng +0.8%

S&P Futures +0.5% at 1,347

April gold +0.3% at $1,730/oz

March Crude +1.0% at $99.62

Overview/Top Headlines

Markets started off the session tentative and mixed despite Greece's parliament passing the austerity measures in a vote of 199 in favor and 74 against with only a majority of 151 needed. EUR/USD extended its gains above $1.3240. All day Sunday Greeks ravaged the center of Athens, setting 10 buildings on fire as tens of thousands demonstrated ahead of the vote. Only after all markets were open did Asian equities all climb into strong positive territory. Shanghai remained under some pressure however due to January new yuan loans coming in weaker than anticipated and China Premier Wen's comments saying that the Govt may fine tune economic policy in Q1; Closely monitoring global conditions. He also affirmed to sticking to current policies to cool the housing market. Housing developers traded in Hong Kong and China fell on the news. USD/JPY declined , testing ¥77.55 after Q4 GDP contracted more than expected. Crude gained nearly 1% after Overseas Shipholding Group, Frontline and owners controlling more than 100 supertankers have announced they will not carry Iran crude. Copper and silver contracts both gained a half a percent in the session. Wheat and corn also saw a strong jump higher on the news that US farmers have hit a record high planting season on continued high prices. 10-yr Treasury notes were little changes in the session at 2%.

Speakers/Geopolitical/In the press

(CN) China govt calling for banks to rollover loans to local govts by as much as 4 years - FT

(HK) Hong Kong Financial Sec Tsang: May see contraction in Q1 GDP if there is a slump in exports

(GR) Greece PM Papademos: The vote will consolidate our place in the euro and avoids default, other option likely to take Greece out of the euro; Sees 2.5-3.0% GDP targets in 2014 and 2015

(HK) According to Midland Realty over the weekend 60 real estate deals happened v 42 last weekend in the primary market - HK Standard

(CN) PBoC may ease banks loan loss reserve requirements - China Business News

(KR) Bank of Korea (BoK): Will keep accommodative policy stance to help protect Korea from EU debt crisis

(JP) Japan Econ Min Furukawa: Japan economy as a whole is continuing upward trend; Expect to continue a moderate recovery trend but will keep an eye on downside risks

Equities

ANZ.AU: Bank workers union: ANZ will be cutting a substantial number of jobs in addition to the 130 it announced last month - Australian press

STEL.SG: Reports Q3 Net S$902M v S$922Me; Rev S$4.83B v $S4.70B y/y

United Co. RUSAL PLC, 486.HK: Reports FY11 alumina production 8.2M tons, +4% y/y; Aluminium production 4.1M tons, +1% y/y

JBH.AU: Reports H1 Net A$79.6M v A$87.9M y/y; Rev A$1.77B v A$1.7B y/y

CBA.AU: Raises variable mortgage rate by 0.1% to 7.41%, cites higher wholesale funding costs

NAB.AU: Raises variab le mortgage rate by 0.09%

LEI.AU: Reports H1 Net A$340M v A$216.7M y/y; Rev A$12.2B v A$9.7B y/y