Aurelia Butler

TOKYO (Reuters) -Big Japanese manufacturers remained pessimistic in April for a fourth straight month as jitters over Western banks added to slowing global growth, the monthly Reuters Tankan survey showed on Wednesday, dimming prospects for an export-led recovery.However, it also showed the service sector mood improved for a second straight month to a four-month high, signalling a post-COVID economic recovery led by inbound tourism, which has boosted restaurants and retailers.”The survey confirmed the economy is on track for a post-coronavirus recovery backed by service-sector firms, although manufacturers are affected by a slowdown in global demand,” said Yoshimasa Maruyama, chief economist at SMBC Nikko Securities.The Reuters Tankan, which closely tracks the Bank of Japan’s (BOA) quarterly key tankan survey, canvassed 493 big non-financial firms. About 240 firms responded during the April 5-14 period on condition of anonymity.The survey results chimed with the BOJ tankan published on April 3, which showed the big manufacturers sentiment index worsened for a fifth consecutive quarter, hurt by elevated costs of raw and other materials, energy and mixed feed, while the service sector mood slightly improved after easing COVID curbs.”Our clients are taking a wait-to-see stance due to anxiety over the financial sector in the United States and Europe and a delay in recovery in Chinese demand,” a manager of a paper/pulp company wrote in the survey.On the other hand, service-sector firms sounded more upbeat on the current business situation.”Private consumption has come back to life as a reaction against a pullback in demand caused by the coronavirus pandemic,” a manager at a retailer wrote in the survey.The sentiment index for big manufacturers in the Reuters Tankan survey stood at minus 3, unchanged from the previous month and posting a fourth straight month of negative readings, according to the survey.It was the longest such sequence since an 18-month run of negative sentiment through the start of 2021 in the wake of the COVID outbreak.The Reuters Tankan manufacturers index is expected to rebound to plus 7 over the next three months.The large service-sector firms’ index edged up to plus 24 in April from plus 21 seen in the previous month, hitting the highest level since December. The index is expected to fall to plus 19 in July.BOJ Governor Kazuo Ueda has vowed to continue monetary easing for the time being to support a fragile economy. The tankan surveys will be among indicators the central bank closely scrutinises to gauge corporate strength when Ueda chairs his debut policy-setting meeting on April 27-28.The Reuters Tankan indexes are calculated by subtracting the percentage of pessimistic respondents from optimistic ones. A negative figure means pessimists outnumber optimists.($1 = 134.1600 yen) More

The lender said total deposits fell 11.3% to $47.6 billion in the first quarter from the previous three months, but deposits steadied late in the quarter, growing $2 billion from March 31 to April 14. “While we experienced elevated net deposit outflows immediately following the closure of other banks, deposit balances quickly stabilized,” said CEO Kenneth Vecchione in a statement. The company said some 73% of its deposits were insured and immediately available liquidity exceeds uninsured deposits, it said. Its proportion of insured deposits was well above industry norms among the 50 largest U.S. banks.Analysts at Bespoke Investment Group wrote in a research note that Western Alliance (NYSE:WAL)’s results were “another sign of stability for banks.” Meanwhile, First Horizon (NYSE:FHN) Corp, a Tennessee-based lender being bought by TD Bank Group, reported quarterly adjusted earnings of 45 cents​​ per share for the quarter, missing analysts’ estimate of 47 cents. First Horizon’s earnings “showed small misses… but in general, while the regional lender fell short of estimates it’s clearly not in the midst of a major crisis,” Bespoke wrote. Western Alliance and other regional lenders came under pressure recently, with consumers moving money into bigger banks after the failure of two U.S. lenders triggered worries about a broader crisis and funding costs.Last month, Western Alliance affirmed its full-year deposit growth forecast of 13% to 17%.Western Alliance’s stock surged more than 15% after the closing bell. Among other regional banks that have been hammered in recent weeks, PacWest Bancorp shares surged 9% and Zions Bancorporation (NASDAQ:ZION), First Republic Bank (NYSE:FRC) and Comerica (NYSE:CMA) Inc each rallied around 3%.Net interest income for Western Alliance rose 36% from a year earlier to $609.9 million in the quarter ended March 31, reaping windfalls from higher interest payments, as U.S. banking heavyweights did.Still, the lender reported a 5% decline in net interest income from the previous quarter due to an increase in average balances of short-term borrowings and interest bearing deposits.A worsening economy prompted the lender to stockpile $19 million in rainy-day funds in the quarter, more than double a year earlier.The lender reported a 3.6% rise in first-quarter adjusted profit from a year earlier to $2.30 per share, well above analysts’ average estimate of $2.04, according to Refinitiv data. More

AMP Bank’s loan book grew over the first quarter compared with the previous three months, while lending margins were largely in line with what they were a year earlier. The company also said momentum in loan applications was improving, despite higher interest rates in the country. “While economic conditions have become more difficult for some borrowers, AMP Bank’s credit quality remains strong,” the company said. AMP is also trying to regain public trust after its involvement in a series of scandals over the past few years, ranging from charging fees for no service to executive misconduct, which led to large-scale fund outflows. The flagship Australian wealth management business saw net cash outflows of about A$606 million ($407.84 million) for the quarter ended March 31, compared with A$873 million of outflows a year ago. Assets under management for the unit stood at A$126.2 billion at the end of the quarter, an around A$2 billion growth from the previous three months, which the company attributed to “positive investment markets”.($1 = 1.4859 Australian dollars) More

(Reuters) – A look at the day ahead in Asian markets from Jamie McGeever.Whisper it, but Wednesday could be a pretty quiet day in Asia after Wall Street closed little changed on Tuesday and with Malaysian trade and Australian leading indicators the only potential market-moving releases on the regional data calendar. Graphic: Dollar/Malaysian Ringgit & Malaysian FX reserves https://fingfx.thomsonreuters.com/gfx/mkt/gdvzqnllapw/MYR.jpg In fact, the main cue could come late in the session from Europe – UK and euro zone consumer price inflation figures for March could go a long way to molding Bank of England and European Central Bank rate expectations for the coming months.Unlike a growing number of central banks in Asia who have pressed the pause button or are close to doing so, the BoE and ECB are both expected to continue raising rates in their battle to get inflation back down towards target.The Fed is also close to the end of its cycle if you believe current market pricing, with one more quarter point hike expected next month. St Louis Fed president James Bullard is much more hawkish though, as he confirmed in an interview with Reuters.Having marched up the hill last year, some policymakers in Asia are taking a breather. The central banks of Australia, Indonesia, India, Singapore and South Korea have all paused, and the Philippine central bank governor signaled a pause in May.Research from the Bank for International Settlements shows that the global tightening cycle since the start of last year is the most synchronized and strongest over the past 50 years, with more than 95% of central banks raising their policy rates.Historically, this share rarely exceeded 50%.One notable absentee from that band is the People’s Bank of China (PBOC). It cut rates in 2020, 2021 and 2022, and is expected to maintain a supportive stance this year even though the economy grew at a faster-than-expected pace in the first quarter.Figures on Tuesday showed that GDP grew 4.5% in Jan-March year-on-year, the strongest in a year, faster than 2.9% the prior quarter, and comfortably above consensus 4.0% forecasts.But the road ahead looks bumpy, and other indicators for March were mixed – retail sales smashed forecasts, but investment fell short.The PBOC sets its one- and five-year loan prime rates on Thursday. They have been anchored at 3.65% and 4.30%, respectively, since last August.Here are three key developments that could provide more direction to markets on Wednesday:- Malaysia trade (March)- Australia composite leading indicator index (March)- UK inflation, euro zone revised inflation (March) (By Jamie McGeever) More