Chinese Stocks Lower After Economic Data

- Chinese data released today was generally in line with market expectations, with most analysts agreeing that today's indicators won't force the PBoC to immediately hike interest rates. September inflation was slightly slower than August, but analysts feel that inflation's up-trend remains intact. Despite Chinese prices rising, retail sales remain well above trend, suggesting that domestic consumption remains very strong. The Chinese government said that macroeconomic curbs have prevented the economy from overheating, adding that the U.S. subprime situation is clouding the outlook for Chinese economic stability.

- (CH) Q3 GDP YOY: 11.5% V 11.5% expected, 11.9% prior

- (CH) SEPT CPI YOY: 6.2% V 6.3% expected, 6.5% prior

- (CH) SEPT RETAL SALES YOY: 17.0% V 17.1% expected, 17.1% prior; YTD YOY: 15.9% V 15.7% prior

- (CH) SEPT PPI YOY: 2.7% V 2.7% expected, 2.6% prior; PURCHASING PRICE INDEX YOY: 3.6% V 3.8% prior

- (CH) SEPT INDUSTRIAL PRODUCTION YOY: 18.9% V 17.5% expected, 17.5% prior; YTD YOY: 18.5% V 18.4% prior

- (CH) SEPT FIXED ASSETS INVESTMENT URBAN YOY: 26.4% V 26.6% expected, 26.7% prior

- South Korea's GDP shows signs of slowing down: (KS Q3 PRELIMINARY GDP QOQ: 1.4% V 1.5% expected, 1.8% prior; YOY: 5.2% V 5.1% expected, 5.0% prior) The data reflects the uncertain outlook for the global economy, with Korean companies cutting investment in facilities by the most in nearly seven years. Analysts said that the data failed to change the market's consensus that the central bank would leave interest rates unchanged for several more months.

- Japanese corporate services price index rises for the 10th straight month: (JP SEPT CORP SERVICE PRICE YOY: 1.4% V 1.0% expected, Prior revised to 1.1% from 1.0%)

- Equities: At 23:08 ET the Nikkei is higher by +0.21% as commodity-related shares traded higher, with upside limited by selling of financials in the aftermath of Merrill Lynch's earnings. Australia's benchmark ASX index is higher by +0.18% as financials rebounded on the back of ANZ Bank's earnings results. The Kospi is higher by more than 1.5% on gains in shares of Samsung and Posco. The Shanghai Composite Index took a dive after the release of economic data, as some investors worry about liquidity. China's benchmark index is currently lower by -2.68%. The Hang Seng is higher by more than 1.5% on gains in shares of property companies and financials.

- Commodities: Today's crude inventory data showed just how tight the crude market is, and crude prices extended gains in Asian trade. Crude oil gained 0.71% between 18:00 ET and 23:16 ET, last quoted at $87.71/bbl. Bearish USD sentiment and higher oil prices continue to support spot gold, with the commodity trading +0.22% at $767.30/oz.

(by Eben Esterhuizen and Gavin Pierce)