Note

Asian equities gain as yuan fixed stronger than expected

· Views 8,135

Asia Market Update: Asian equities gain as yuan fixed stronger than expected, China trade data beats ests; Kospi outperforms as Japan partially eases export restrictions on Korea

General Trend:

- Chip-related firms in Japan rise on the South Korea news

- Chinese brokerage firms gain on plan by China to ease funding charges

- China Mobile reports decline in H profits, EBITDA rose

- RBA Gov Lowe is due to appear before Australia House of Representatives Standing Committee on Economics on Aug 9 (Friday)

Headlines/Economic Data

Australia/New Zealand

- ASX 200 opened -0.1%

- (NZ) Reserve Bank of New Zealand (RBNZ) Official Hawkesby: Even at a low rate level, monetary policy is still effective

- (NZ) Reserve Bank of New Zealand (RBNZ) Gov Orr: Reiterates that in the absence of consumer, business or govt spending as expected we will have to lower rates further

- (AU) Reserve Bank of Australia (RBA) Assistant Gov Bullock: when the financial sector is doing its job of facilitating a smooth flow of funds in the economy to support economic growth - speech Financial Stability Through the Lens of Business

- AMP.AU Reports H1 (A$) underlying Net 309M v 495M y/y; Rev 6.25B v 7.17B y/y; to sell life unit to Resolution Life for A$3.0B (2.5B cash and 500M equity)

- RFF.AU Issued response to report from short selling firm Bonitas: Rejects the 'unfounded' allegations; Hires Ernst and Young to independently investigate the matters raised by Bonitas Research

Japan

- Nikkei 225 opened +0.1%

- (JP) Japan govt reportedly preparing to approve exports of some semiconductor materials to South Korea; would be first such approval since Japan tightened export controls in July – Nikkei

- (JP) Japan said to consider holding extra parliamentary session in Oct which could focus on revision of Japan's corporate law to require large companies to have outside board directors - Japanese Press

- (JP) Japan Fin Min Aso: Closely watching impact of US/China trade conflict; volatility in exchange rates not desirable for economy

- (JP) JAPAN JUNE PRELIMINARY TRADE BALANCE (BOP BASIS): ¥759.3B V ¥691.4BE

- (JP) JAPAN JUNE PRELIMINARY ADJUSTED CURRENT ACCOUNT: ¥1.94T V ¥1.74TE; CURRENT ACCOUNT BALANCE: ¥1.21T V ¥1.149TE; Japanese bought ¥279.5B v sold net ¥39.2B of Italy bonds prior (highest since 2005)

- (JP) Japan Q2 Housing Loans Y/Y: 2.2% v 2.4% prior

- 6740.JP Announces entry into amended agreement to receive ¥80B bailout, to borrow an additional ¥20B from INCJ

- 4004.JP Reports H1 Net ¥65.8B v ¥58.0B y/y, Op ¥85.5B v ¥77.9B, Rev ¥475.5B v ¥455.9B y/y; Cuts outlook

- (JP) Japan MoF sells ¥400B in 10-year inflation-linked JGBs: highest yield: -0.3290%, bid to cover 4.84x

Korea

- Kospi opened +0.9%

- (KR) South Korea PM Lee: Confirms that Japan has granted first approval of high-tech materials since export curbs were put in place in July; approval was for EUV photoresistors

- (KR) Bank of Korea (BOK) reiterates to maintain accomodative policy stance on slowing economic growth; expect economic growth to be slow and inflationary pressure to be low - Parliament report

- 005935.KR Japan likely to allow the export of resist polymers to Samsung - Japan Press

- 005930.KR Mobile Unit Head: Prolonged Japan curbs could affect phone parts - Korean press

China/Hong Kong

- Hang Seng opened flat; Shanghai Composite opened +0.6%

- (CN) CHINA PBOC SETS YUAN REFERENCE RATE: 7.0039 V 6.9996 PRIOR (weakest fix below 7 since April 2008)

- (CN) CHINA JUL TRADE BALANCE: $45.1B V $42.7BE; Exports Y/Y: +3.3% v -1.0%e, Imports Y/Y: -5.6% v -9.0%e; July Trade Surplus with the US: $27.9B v $29.9B prior

- (CN) CHINA JULY TRADE BALANCE (CNY): 310.3T V 310.0BE; Exports Y/Y: 10.3% v 7.0%e; Imports Y/Y: +0.4% v -3.3%e; YTD Trade Balance with US 1.15T; Imports from US -24% y/y; Exports to US -2.1% y/y

- (CN) China reportedly considering new measures to stabilize trade - Chinese Press

- (HK) China has warned Hong Kong that it will intervene if situation gets worse - financial press

- (CN) China PBoC Open Market Operation (OMO): Skips for 12th consecutive session; Net CNY0B drained v CNY0B drained prior

- (CN) According to Institute of International Finance (IIF) China household debt is so high that any Govt stimulus targeted to boost consumer spending is likely to be ineffective - SCMP

- China Mobile, 941.HK Reports H1 (CNY) Net 56.1B v 65.6B y/y; EBITDA 151.1B v 145.9B y/y; Rev 389.4B v 391.8B y/y

- (CN) State Administration of Foreign Exchange (SAFE) Chief Economist Chugying: US decision to label China "a currency manipulator" totally deviates from the facts and doesn't have a leg to stand on; FX market has been running smoothly in general - Xinhua

- (CN) CHINA JULY FOREIGN RESERVES: $3.104T V $3.105TE (1st decline in 3 months) (overnight yesterday)

Other Asia

- (PH) Philippines Q2 GDP Q/Q: 1.4% v 1.5%e; Y/Y: 5.5% v 5.9%e

- TATA.IN Reports Q2 (INR) Net 6.93B v 19.4B y/y, EBITDA 55.3B v 56.5Be; Rev 359.5B v 372.8Be

North America

- NTES Reports Q2 $4.09 (adj) v $3.40 y/y, Rev $2.73B v $2.73Be y/y

- (CN) Fox Business's Lawrence: China trade sources say China expects that 10% tariff to go to 25% because China will stand firm and not buy US Agriculture

- (US) Fed Evans (dove, voter): sees mid-cycle adjustment has the Fed aiming for 50bps below Neutral rate, rather than 50bps above; The inflation outlook alone calls for more accommodation - comments to reporters

Europe

- (UK) JULY RICS HOUSE PRICE BALANCE: -9% V -1%E

- (UL) US Sec of State Pompeo: US is ready to sign UK-US trade agreement after Brexit

Levels as of 1:20 ET

- Nikkei 225, +0.5%, ASX 200 %, Hang Seng +0.5%; Shanghai Composite +0.9%; Kospi +1%

- Equity Futures: S&P500 +0.5%; Nasdaq100 +0.6%, Dax +0.4%; FTSE100 +0.9%

- EUR 1.1214-1.1196 ; JPY 106.30-105.99 ; AUD 0.6783-0.6746 ;NZD 0.6469-0.6433

- Gold -0.6% at $1,511/oz; Crude Oil +2.9% at $52.57/brl; Copper +0.2% at $2,591/lb


Disclaimer: The content above represents only the views of the author or guest. It does not represent any views or positions of FOLLOWME and does not mean that FOLLOWME agrees with its statement or description, nor does it constitute any investment advice. For all actions taken by visitors based on information provided by the FOLLOWME community, the community does not assume any form of liability unless otherwise expressly promised in writing.

FOLLOWME Trading Community Website: https://www.followme.com

If you like, reward to support.
avatar

Hot

No comment on record. Start new comment.