General Trend:

  • Japanese equities decline upon return from holiday, banks decline; TOPIX Electric Appliances index drops amid uncertainty regarding Japan/Korea relations
  • Rio Tinto reversed opening loss, issued Q2 production update
  • Shanghai Property index rises as official said H1 property market conditions were stable
  • New Zealand inflation accelerated in Q2 amid rate cut, data remained below mid-point of RBNZ’s targeted range
  • RBA July minutes in line with recent comments from Gov Lowe; Little initial impact seen on Aussie, Australia monthly jobs data due on July 18th (Thursday)
  • Companies expected to report earnings during the NY morning include Goldman Sachs, JNJ, JPMorgan and Wells Fargo.

Headlines/Economic Data

Australia/New Zealand

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  • ASX 200 opened flat
  • RIO.AU Reports Q2 Pilbara iron ore shipments 85.4Mt v 83.4Mte v 88.5Mt y/y; Pilbara iron ore production: 79.7Mt v 81.5Mte v 85.5Mt y/y
  • RIO.AU Gives update on Oyu Tolgoi underground project; Raises CAPEX for project to $6.5-7.2B (prior $5.3B)
  • (NZ) NEW ZEALAND Q2 CPI Q/Q: 0.6% V 0.6%E; Y/Y: 1.7% V 1.7%E
  • OSH.AU Reports H1 Total production 14.1 MMBOE v 10.2 y/y; Rev $777.0M v $557.8M y/y
  • (AU) Australia sells A$150M v A$150M indicated in 1.25% indexed Feb 2022 bonds, avg yield -0.2118%, bid to cover 4.93x
  • (NZ) New Zealand Q2 RBNZ Sectoral Factor Model Inflation Index y/y: 1.7% v 1.7% prior; Sectoral Factor Model Non-Tradeable (core) Y/Y: 2.8% v 2.8% prior


  • Nikkei 225 opened -0.2%
  • 6740.JP South Korea reviewing taking Japan to WTO for its support of Japan Display – Korean press
  • (JP) Japan Trade Min Seko: Sufficient explanations given to South Korea on trade; regrettable that South Korea has given mistaken explanation; Will be difficult to restart policy talks with S. Korea quickly
  • 7011.JP Lawyers representing South Korean plaintiffs who won damages over wartime forced labor, will apply in the near future to have court issue orders to sell seized company assets in South Korea


  • Kospi opened +0.1%
  • (KR) South Korea President Moon: Japan’s reported accusations that South Korea had exported banned goods to North Korea poses a “grave challenge”
  • (KR) North Korea releases full text of new constitution; affirms that North Korea is a ‘nuclear state’ – Korea Press
  • (KR) South Korea foreign Ministry official: US has indicated they are willing to play a “suitable” role in trying to diffuse tensions between Japan and South Korea – Yonhap

China/Hong Kong

  • Hang Seng opened +0.1%; Shanghai Composite opened -0.1%
  • (CN) China PBOC sets yuan reference rate: 6.8710 v 6.8677 prior
  • (CN) China PBoC Open Market Operation (OMO): Injects CNY160B in 7-day reverse repos v skip prior; Net CNY160B injected v skip prior (1st injection after 16 sessions)
  • (CN) China NDRC: H2 CPI expect to be stable; reiterates China avoids flood style stimulus; China real economy still facing many difficulties with renewed downward pressures due to rising external uncertainties and domestic structural problems
  • (CN) China PBOC Dep Gov Pan Gongsheng: China will expand yuan use in cross border investment

Other Asia

  • (ID) Indonesia lobbying China to use palm oil instead of soybean oil
  • (SG) IMF lowers Singapore 2019 GDP to 2.0% (prior 2.3%)
  • (TW) China has mobilized some of its elite military forces for an exercise near the Taiwan Strait but has softened its rhetoric to avoid antagonizing the United States

North America

  • (CN) Pres Trump: China Pres Xi is a friend, probably ‘not quite’ as close now
  • (CN) NYT opinion piece: US tariffs on China don’t cover the costs of Trump’s ‘trade war’, tariffs on Chinese goods generated ~$20.8B in revenue as of Wed vs the $28.0B that Trump has committed to help US farmers deal with trade impact
  • (US) President Trump on China: China’s 2nd Quarter growth is the slowest it has been in more than 27 years. The United States Tariffs are having a major effect on companies wanting to leave China for non-tariffed countries. Thousands of companies are leaving. This is why China wants to make a deal…. with the U.S., and wishes it had not broken the original deal in the first place. In the meantime, we are receiving Billions of Dollars in Tariffs from China, with possibly much more to come. These Tariffs are paid for by China devaluing & pumping, not by the U.S. taxpayer! – tweet


  • AMS.CH Confirms talks with Osram, do not see sufficient basis for continuing talks with Osram
  • (UK) PM candidate Johnson: the US is ruthless in trade negotiations; we would be tough with the US in talks on US-UK trade deal

Levels as of 1:20 ET

  • Nikkei 225, -0.7%, ASX 200 -0.1%, Hang Seng +0.1%; Shanghai Composite -0.3%; Kospi +0.3%
  • Equity Futures: S&P500 +0.1%; Nasdaq100 +0.1%, Dax -0.1%%; FTSE100 -0.2%
  • EUR 1.1265-1.1255 ; JPY 108.09-107.82 ; AUD 0.7045-0.7032 ;NZD 0.6739-0.6711
  • Gold +0.2% at $1,415/oz; Crude Oil flat at $59.56/brl; Copper -0.2% at $2.710/lb
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