Asian Equities Track US Gains

Jun 11 19, 06:21 GMT

General Trend:

Property, materials and industrial sectors outperform in China amid expectations for more infrastructure spending
Shanghai IT index rises over 2.5%, chipmaker Sanan Optoelectronics up over 5%
Financials, Electric Appliance, Marine/Transportation and Steel companies are among the gainers in Japan
ASX 200 outperforms on holiday impact
Australia NAB business confidence rises in May amid post-election impact and RBA rate cut expectations
Chinese yuan (CNY) rises as PBoC said it will sell bills in Hong Kong later in June
China continues to stress that it will support smaller banks, regulator addresses market rumors
South Korea’s exports extended declines into early July, chip exports and shipments to China continue to drop
HK legislative Council is expected to start debate on Wednesday on new government extradition bill (would allow suspects wanted in mainland China to be sent across the border for trial)

Headlines/Economic Data

Australia/New Zealand

ASX 200 opened +0.2%
(AU) AUSTRALIA MAY NAB CONFIDENCE: 7 V 0 PRIOR; BUSINESS CONDITIONS: 1 V 3 PRIOR
WPL.AU Guides FY19 production to lower end of prior 88-94 MMBOE due to delay at the Pluto LNG turnaround; production restart targeted for June 2019
VOC.AU AGL Energy makes indicative offer of A$4.85/shr cash, grants exclusive due diligence
(NZ) New Zealand Q1 Manufacturing Activity Q/Q: +1.0% v -0.5% prior; Activity Volume Q/Q: +2.0% v 2.0% prior

Japan

Nikkei 225 opened -0.2%
7201.JP CEO Saikawa: Renault opposition to reform is “most regrettable”, planned corporate governance overhaul is only option – Nikkei
(JP) BOJ, PBoC and BOK governors said to have held a meeting to exchange views on economic and financial situation – financial press
(JP) Japan PM Abe will not hold double election (simultaneous elections in the upper and lower house) this summer – Japan press
7201.JP Japan Industry Min Seko: Closely watching how Renault will assess Nissan’s attempts to improve corporate governance

Korea

Kospi opened -0.2%
(KR) South Korea Jun 1-10 Exports -16.6% y/y; Chip Exports -30.8% y/y
(KR) North Korea leader Kim half brother Kim Jong Nam who was killed in 2017 said to have been a CIA informant and had met with US officials – US press

China/Hong Kong

Hang Seng opened +0.4%; Shanghai Composite opened +0.1%
(CN) China issued notice related to local government special bonds issuance and project financing; to encourage financial firms and individuals to invest in local gov’t bonds; To allow local governments to use the proceeds from special bonds as capital for qualified major projects.
(CN) China PBOC may continue to support small banks with various tools, including targeted RRR cuts, MLF and SLF – China Securities Journal
(CN) China reportedly planning to tighten rules on smaller lending firms – Chinese Press
(CN) China PBOC to sell bills in Hong Kong later in June in order to improve yuan bond yield curve in Hong Kong, no amount given
(CN) China PBoC Open Market Operation (OMO): Injects CNY10B in 7-day reverse repos v CNY30B prior; Net CNY50B drain v CNY50B drain prior
(CN) China PBoC sets yuan reference rate: 6.8930 v 6.8925 prior
(CN) Trump’s G20 meeting with China President Xi could again be a formal dinner – SCMP
(CN) China National Grain Center: To start auctions of soybeans from reserves on June 17th

Other Asia

(PH) Philippines Apr Trade Balance: -$3.5B v -$3.9Be; Exports Y/Y: +0.4% v 1.0%e (first rise in 6 months); Imports Y/Y: -1.9% v 3.7%e

North America

(US) Pres Trump: If China Pres Xi doesn’t come to the G20, we would put the next $300B of tariffs into effect immediately – CNBC interview
CVS Federal judge said to be close to rejecting planned merger with Aetna, says US District judge Richard Leon has concerns about the impact of the transaction on prices and competition – NY Post

Europe

(UK) UK Conservative party announces official entrants to leadership race for PM
(IT) Italy Conte’s Office comments after PM met with Di Maio and Salvini: Reiterates Finance Min Tria to help set strategy for dealings with EU
(UK) Right-wing Tory ’92 Group supports MP Boris Johnson for PM in non-binding vote – press
(UK) BOE’s Saunders: rates may need to rise faster than curve implies; BOE doesn’t need to wait for Brexit resolution to act

Levels as of 1:20 ET

Nikkei 225, +0.3%, ASX 200 +1.5%, Hang Seng +0.8%; Shanghai Composite +2%; Kospi +0.5%
Equity Futures: S&P500 +0.2%; Nasdaq100 +0.4%, Dax +0.3%; FTSE100 +0.2%
EUR 1.1320-1.1307 ; JPY 108.64-108.34 ; AUD 0.6967-0.6952 ;NZD 0.6612-0.6593
Gold +0.3% at $1,332/oz; Crude Oil +0.4% at $53.58/brl; Copper +0.6% at $2.678 /lb