HomeContributorsFundamental AnalysisAsian Equities Trade Generally Higher, Modest Rise Seen For USD Index

Asian Equities Trade Generally Higher, Modest Rise Seen For USD Index

General trend

  • Asian automakers generally track US gains.
  • Nikkei has outperformed as USD/JPY trades near ¥110 [Big components rise (Softbank Group, Fast Retailing); Automakers track strength in US autos].
  • S&P ASX 200 has extended gains after opening flat [Resources index rises over 2% amid strength in Chinese metals; Guidance from Inghams supports Consumer Staples index].
  • Shanghai Composite ended the morning session flat; Financials rise at the start of the afternoon session.
  • Hang Seng has remained higher, currently trades near the opening level [Property, Financial and Materials indices rise; JD Logistics rises over 13% in trading debut; Meituan is due to report earnings today].
  • Companies due to report during the NY morning include Big Lots, Hibbett Sporting Goods.

Headlines/Economic data

Australia/New Zealand

  • ASX 200 opened flat.
  • (AU) Australia sells A$1.0B v A$1.0B indicated in 4.75% April 2027 bonds, avg yield 0.8948%, bid to cover 2.1x.
  • (AU) Reserve Bank of Australia (RBA): Approved consultation on proposed package of policy actions related to bank retail payments; in general not proposing major reforms to the Bank’s retail payments regulation.
  • (NZ) Reserve Bank of New Zealand (RBNZ) Gov Orr: Reiterates downside risks have abated; Only seeing wage pressures in certain sectors; Sees dramatic slowing in Housing price growth to 0.
  • (NZ) New Zealand May Consumer Confidence: 114.0 v 115.4 prior.
  • (NZ) New Zealand Apr Jobs filled +0.3% m/m.

China/Hong Kong

  • Hang Seng opened +0.4%, Shanghai Composite +0.1%.
  • (CN) China PBOC sets Yuan reference rate: 6.3858 v 6.4030 prior (Strongest since May 24, 2018).
  • (CN) China PBoC: Current Forex market is balanced; exchange rate impacted by many factors; Exchange rate cannot be used to offset commodity price rise or spur exports.
  • (CN) China PBOC Open Market Operation (OMO): Injects CNY10B in 7-day reverse repos v CNY10B in 7-day reverse repos prior; Net CNY0B v Net CNY0B prior.
  • (US) China competitiveness bill passes procedural hurdle in the Senate.
  • (CN) China Banking Regulator (CBIRC) issued final rules related to sales of wealth management products, expanded the rules to cover commercial banks and foreign-owned companies – Chinese press.
  • (CN) China has set up CNY70B worth of equity investment funds related to the reforming of state-owned companies – US financial press.

Japan

  • Nikkei 225 opened +1.3%.
  • (JP) Reportedly BOJ contemplating 6-month extension to Sept deadline for pandemic relief program as early as next rate review – Nikkei.
  • (JP) Japan Econ Min Nishimura: Confirms govt will seek to extend coronavirus state of emergency in Tokyo and additional prefectures until June 20th.
  • (JP) Bank of Japan (BOJ) reports FY20/21 Net ¥1.22T v ¥1.30T y/y, Op Rev ¥2.42T v ¥2.24T y/y.
  • (JP) JAPAN MAY TOKYO CPI Y/Y: -0.4% V -0.5%E; CPI (EX-FRESH FOOD) Y/Y: -0.2% V -0.2%E.
  • (JP) JAPAN APR JOBLESS RATE: 2.8% V 2.7%E.

Korea

  • Kospi opened +0.2%.
  • (KR) South Korea said to be extending tax cuts on passenger cars an additional 6-month – Press.

North America

  • (US) President Biden to propose a $6.0T budget for FY22 to boost middle class and increase infrastructure – financial press.
  • (US) Biden budget reportedly will assume capital gains tax rate raise began in late April; would limit investors’ ability to avoid it – press.
  • (US) Senate GOP releases $928B counteroffer infrastructure proposal.
  • (US) Kansas City Fed to hold Jackson Hole central bankers’ meeting in person this year – press.

Europe

  • (UK) BOE’s Vlieghe (dove): 1st rate rise is likely to become appropriate only well into 2022; Will not be a part of MPC when the time comes to raise rates (**Note: term ends in Aug) [from May 27th].
  • (UK) May Lloyds Business Barometer: 33 v 29 prior.

Levels as of 01:20 ET

  • Nikkei 225, +2.2%, ASX 200 +1.2% , Hang Seng +0.6%; Shanghai Composite +0.2% ; Kospi +0.9%.
  • Equity S&P500 Futures: +0.3%; Nasdaq100 +0.2%, Dax flat; FTSE100 +0.4%.
  • EUR 1.2196-1.2181 ; JPY 109.95-109.76 ; AUD 0.7748-0.7735 ;NZD 0.7297-0.7267.
  • Gold -0.1% at $1,893/oz; Crude Oil +0.5% at $67.20/brl; Copper -0.1% at $4.6653/lb.

 

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