Martin Luther King Jr Day News Round Up - Newsquawk Asia-Pac Market Open

• US stock markets were closed for Martin Luther King Jr Day.
• Yemen Houthi military spokesman said they consider all American and British vessels and warships participating in aggression against them as hostile targets.
• Looking ahead, highlights include Australian Westpac Consumer Sentiment & Building Approvals, Japanese PPI & 5yr JGB Auction.

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LOOKING AHEAD

• Highlights include Australian Westpac Consumer Sentiment & Building Approvals, Japanese PPI & 5yr JGB Auction.
• Click here for the Newsquawk Week Ahead.

US TRADE

• US stock markets were closed for Martin Luther King Jr Day.

NOTABLE HEADLINES

• WSJ's Timiraos wrote Fed officials are to start deliberations on slowing but not ending (QT) as soon as their policy meeting this month, while the article listed three reasons why and cited Fed speak and Fed research.

COMMODITIES

• Marathon (MPC) Galveston Bay Texas refinery (593k BPD) reported emissions from RHU flare and decreased rates to lower pressure on the system to reset the RV and stop flaring, according to Reuters.
• Russia is considering a ban on gasoline exports after the incident at Lukoil's Norsi refinery, according to Interfax citing sources.
• India cut the windfall tax on petroleum crude to INR 1.7k per ton from INR 2.3k per ton effective January 16th.
• Chile's Cochilco sees Chilean copper production rising 5.7% to 5.63mln metric tons in 2024, while it raised its 2024 copper price forecast to USD 3.85/lb from USD 3.75/lb and sees 2025 copper price at USD 3.90/lb.

GEOPOLITICAL

• Israeli Cabinet passed an amended 2024 state budget to include spending to finance the war with Hamas, while the new budget added ILS 55bln for defence and compensation, according to the Finance Ministry.
• US Central Command said Iranian-backed Houthi militants fired an anti-ship ballistic missile from the Houthi-controlled areas of Yemen and struck the M/V Gibraltar Eagle, while the ship reported no injuries or significant damage and is continuing its journey.
• US warned ships to avoid the southern Red Sea until further notice and warned of the potential for Houthi retaliation.
• UK PM Sunak signalled the UK could participate in further strikes against Houthi rebels and told MPs that Britain will not hesitate to protect its interests where required, according to FT.
• Yemen's Houthi negotiator said attacks on Israeli ships and ships headed to Israel in the Red Sea will continue, while all ships in the Red and Arabian seas are safe except vessels headed to Israel. However, it was later reported that a Houthi military spokesman said they consider all American and British vessels and warships participating in aggression against them as hostile targets.
• Iran’s Islamic Revolutionary Guard Corps commanders and advisors are on the ground in Yemen and playing a direct role in Houthi rebel attacks on commercial traffic in the Red Sea, according to SEMAFOR.
• Explosions were reported in Aleppo, Syria which was reportedly caused by Israeli shelling, according to Al Arabiya.
• Explosions were reported in different areas in Erbil, northern Iraq, according to Al Arabiya. Furthermore, IRGC said it attacked espionage centres and gatherings of anti-Iranian terrorist groups in Iraq’s Erbil and that Islamic State was targeted in occupied Syria in response to the group’s recent terrorist attacks in Iran, according to Reuters.
• North Korea decided to shut down organisations dealing with unification and inter-Korean tourism, while North Korean leader Kim said they do not want war but have no intention to avoid it. Furthermore, Kim said war will destroy South Korea and deal an unimaginable defeat to the US, according to KCNA.

ASIA-PAC

NOTABLE HEADLINES

• China and Switzerland have signed a declaration on developing a free trade agreement in an important step towards possible negotiations, according to the Swiss government.

DATA RECAP

• South Korean Export Prices YY (Dec) -2.3% (Prev. -7.2%)
• South Korea Import Prices YY (Dec) -4.1% (Prev. -8.5%)
• New Zealand NZIER Confidence (Q4) -2.0% (Prev. -52.0%)
• New Zealand NZIER QSBO Capacity (Q4) 91.4% (Prev. 87.3%)

EU/UK

NOTABLE HEADLINES

• ECB's Herodotou said it is too soon to contemplate policy easing or the pace of easing and more time is needed to be sure that Euro Area HICP would indeed return to the target despite recent positive inflation developments.
• ECB's Holzmann (hawk) said rate cut expectations are optimistic and shouldn't count on rate cuts at all in 2024, according to a CNBC interview.
• ECB's Nagel (hawk) said it's too early to discuss rate cuts as inflation remains too high and maybe the ECB can wait until after the summer break, while he added that markets are sometimes over-optimistic, according to a Bloomberg TV interview.

DATA RECAP

• German Full Year GDP (2023) -0.3% vs. Exp. -0.3% (Prev. 1.8%)
• EU Industrial Production MM (Nov) -0.3% vs. Exp. -0.3% (Prev. -0.7%)
• EU Industrial Production YY (Nov) -6.8% vs. Exp. -5.9% (Prev. -6.6%)