Asian Equity Markets Trade Generally Higher After US Gains On Tuesday

May 22 19, 06:52 GMT

General Trend:

China video surveillance firm Hikvision declines by daily limit on US blacklist speculation; Shares pare some of declines after response by company
Later report says even more Chinese video surveillance firms could be blacklisted
Chinese chipmakers extend gains on speculation they may benefit from US crackdown on Huawei
Men’s retailer Mulsanne Group [1817.HK] says acceleration of US/China trade war weighed on the pricing of its IPO
China Ambassador to the US says remains ready to hold trade talks with US (no timeframe given)
PBOC continues to fix the yuan weaker in the face of the speculated US/China trade talk impasse
PBoC said to plan to sell additional CNY denominated bills in HK amid recent currency weakness
Japanese exports decline for 5th straight month in April, shipments to China weigh
Japan 20-yr bond auction has record bid to cover
Asian currencies trade generally weaker amid concerns related to factors including trade, geopolitics and slowing growth
Thailand exports weighed down by US/China trade rift
Post-election clashes have been reported in Jakarta (Indonesia)
Japanese telecoms start to take actions regarding Huawei
US Fed minutes due for release on Wed

Headlines/Economic Data

Australia/New Zealand

ASX 200 opened slightly lower
(AU) China said to maintain Australia coal imports ‘slowdown’ after election – US financial press
(AU) AUSTRALIA Q1 CONSTRUCTION WORK DONE Q/Q: -1.9% V 0.0%E
(AU) Victoria State government (Australia) said to tighten rules for online betting operators – US financial press
(NZ) NEW ZEALAND Q1 RETAIL SALES (EX INFLATION) Q/Q: 0.7% V 0.6%E; Y/Y: 3.3% V 3.5% PRIOR
LYC.AU Clarifies mineral resource and ore reserve figures: Confirms there have been no material changes to the 2018 mineral resource and 2018 mineral reserve data released on Aug 6 2018
(AU) Australia Apr Westpac Leading Index M/M: -0.1% v 0.3% prior
(NZ) Reserve Bank of New Zealand (RBNZ) Publishes review of loan to value ratio (LVRs) policy: LVRs should not be used as a monetary policy lever; Should keep ability to use macro prudential tools
TBH.AU Unit entered into agreement with Betgenius, relates to the distribution of racing solution

Japan

Nikkei 225 opened +0.5%
(JP) Bank of Japan (BOJ) Harada (dissenter): Sales tax hike may worsen economy and push down inflation
(JP) Japan Trade Negotiator: Japan auto export restriction to US was not brought up during talks
(JP) JAPAN MAR CORE MACHINE ORDERS M/M: 3.8% V 0%E; Y/Y: -0.7% V -3.4%E
(JP) JAPAN APR TRADE BALANCE: ¥60.4B V ¥232.7BE; ADJ TRADE BALANCE: -¥110.9B V -¥37.5BE; Exports Y/Y: -2.4% v -1.6%e (5th consecutive decline); Exports to China -6.3% y/y; US +9.6% y/y
(JP) Japan MoF sells ¥900B v ¥900B indicated in 0.40% (prior 0.50%) 20-year bonds; avg yield 0.359% v 0.391% prior; bid to cover 5.47x v 4.84x prior

Korea

Kospi opened +0.1%
(KR) South Korea think tank KDI: South Korea needs ‘substantially’ accommodative monetary policy, notes slowing inflation; cuts 2019 GDP growth forecast to 2.4% v 2.6% prior
(KR) OECD cuts South Korea 2019 GDP outlook to 2.4% (prior 2.6%) and 2020 GDP 2.5% (prior 2.6%) due to weaker domestic demand

China/Hong Kong

Hang Seng opened +0.4%; Shanghai Composite opened flat
(CN) China Ambassador to US Tiankai: China remains ready to hold trade talks with US; China is ready to address trade imbalance with US, buy more US products and services
(CN) China reportedly has no information on Trump-Xi meeting at G20 in Japan despite Trump’s earlier announcement
(CN) China President Xi: China needs to embark on a long new march and will start all over again, being interpreted by analysts that China is prepared for a long draw out trade war with the US – SCMP
700.HK Reportedly Tencent is warning about slower growth in FY19 China video ad sales – Nikkei
(CN) PBoC said to consider sale of additional bills amid recent currency weakness – financial press
002415.CN US Trump administration said to be considering placing the company on blacklist, the final decision could be made in the coming weeks (largest provider of video surveillance equipment with internet enabled) – NYT
002415.CN Exec: Not been informed of possible blacklisting by US; have other sources if US decides to limit chip sales; See no impact form any move by the US – Chinese press
(CN) China PBoC Open Market Operation (OMO): Injects CNY20B in 7-day reverse repos v CNY70B prior: Net: CNY20B v CNY80B prior
(CN) China PBoC sets yuan reference rate: 6.8992 v 6.8990 prior
(CN) China PBOC details plans on how it will cut RRR for rural commercial banks announced May 6th: To take part in 3 stages (May 15th, June 17th and July 15th)

Other Asia

(ID) Indonesia reporting that 6 have died and more than 200 injured in Jakarta as fighting breaks out over election results
(TH) Thailand Apr Customs Trade Balance: -$1.5B v -$0.4Be; Commerce Ministry Official says exports were hurt by US/China trade war

North America

(US) Weekly API Oil Inventories: Crude: +2.4M v +8.6M prior
(US) SEMI: Apr North America Billings: $1.91B v $1.83B prior, m/m: +4.7% v -1.9% prior; y/y: -29.0% v -24.6% prior
(US) Fed’s Bullard (Dove, voter): Rate cut may help maintain inflation goal credibility, 2019 CPI may fall short of target; baseline scenario is that trade agreements will be reached soon – speaks in Hong Kong on US Economic Outlook
WYNN Confirms MGM will not continue talks on Boston Harbor casino, remain committed to opening the casino
(US) US Business Lobby (AMCHAM CHINA): nearly half of member firms in China seeing non-tariff barrier retaliation in trade war – financial press

Europe

(UK) UK PM May Spokesperson: Cabinet discussed new deal on Brexit to be presented in Parliament, no deal remains a plausible outcome and work is ongoing
(UK) UK PM May Spokesman: Has not yet decided whether to whip 2nd referendum vote
(UK) Ireland PM Varadkar: sounds like PM May’s withdrawal bill would be acceptable to Ireland
(UK) PM May: Govt’s Customs Union plan is one possibility for Brexit

Levels as of 1:20 ET

Nikkei 225, +0.1%, ASX 200 +0.1%, Hang Seng +0.2%; Shanghai Composite -0.2%; Kospi +0.3%
Equity Futures: S&P500 -0.1%; Nasdaq100 -0.2%, Dax -0.1%; FTSE100 +0.3%
EUR 1.1170-1.1158; JPY 110.62-110.46 ; AUD 0.6887-0.6872 ;NZD 0.6511-0.6499
Gold flat at $1,273/oz; Crude Oil -0.8% at $62.65/brl; Copper -0.1% at $2.712/lb