Morning Memo: Thursday, January 2, 2014

"Morning Memo" begins below this "NOTE for  NEWCOMERS" to "Morning Memo"...... Each morning, we post a short bullet-point list of noteworthy events, data, etc that find their way into the assessment of global markets.  It's far from complete and is not meant to be an exhaustive reconciliation of all things that could possibly impact stocks, bonds, currencies and commodities!  Rather, it's best viewed as a cryptic memo of "highlights", noteworthy items that took place in Asia, European and US hours.....and color-coded 'Red' for seemingly negative impact on equity markets, 'Green' for positive.
This will also serve as a useful review mechanism, as scrolling through the series of "Morning Memo" posts over time ought to summarily highlight what generally drove price action.  
We hope you find this useful and informative....and as always, that you'll share feedback!!
5:00am ET...   HAPPY NEW YEAR!!!

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•  (picture above from the WSJ)
• Asia...markets were mixed but any enthusiasm was subdued by China's HSBC PMI data for Dec which while still above 50 (indicating expansion), was down to 50.5 fr 50.8 the prev month.  New Export Orders component of the index registered first decline since August.  Yesterday, the official gov't PMI data was reported down to 51.0 in Dec from Nov's 51.4. China's domestic market was also weighed down by the lifting of the suspension on IPOs which had been in place since late '12.
• Japan...closed for holiday. USD/YEN still above 105.
• Taiwan...PMI rose to 55.2 in Dec fr 53.4 in Nov, a strong number likely linked to global demand for smartphones, since Taiwan's exports (3/4 of their GDP) is heavily tied to technology.
• Indonesia...rallied 1% on HSBC's PMI rising to 50.9 from Nov's 50.3  That was despite inflation data that was higher than expected and which raises the prospects for further rate hikes in '14. The central bank has raised rates several times in '13 to defend the currency, prevent further capital outflows, and manage an already difficult current account deficit.
• Vietnam...HSBC PMI expands to 51.8 in Dec from 50.3 in Nov. 
• South Korea....trades lower on stronger Won. and despite an HSBC/Markit PMI rise to a seven month high. 
• India....PMI dropped to 50.7 fr 51.3.  But the sub-components for output, new orders and employment all rose.
• GOLD...surges $20/oz as buyers of the physical commodity emerged, most notably from China where the Lunar New Year falls at the end of Jan and when gold buying is usually stronger.  (Note:  2013 was one of the worst years for gold in decades, so many analysts are describing today's buying as 'bargain hunting'.)
• Europe....opened higher ahead of PMI data.
• Italy...PMI hits highest level since '11.
• Spain...PMI increased and new orders rebounded.
• UK....PMI falls in Dec to 57.3, lower than expected.  But UK's overall PMI level remains near decade highs.
• Of interest:

Eurozone Manufacturing #PMI climbs to 31-month high of 52.7 in Dec, from 51.6 in Nov http://t.co/Uz9yH5MwmX pic.twitter.com/XQUUtxFSRq
— Markit Economics (@MarkitEconomics) January 2, 2014

• more later....

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