Asia Summary
Asian equity markets have traded generally lower ahead of the later today release of US Q2 advance GDP data. Australia’s ASX 200 has underperformed and declined by over 1.4% amid weakness in mining shares and banks. Shares of Samsung Electronics have declined by over 3% amid its recent financial guidance
In Japan, shares of Nissan (-3.5%), Tokyo Electron (-6%) and Daiwa Securities (-4%) are all declining following their respective earnings reports and outlooks. Toshiba has declined by over 8% after a US judge ruled that his court has the authority to consider Western Digital’s request to temporarily block the sale of the Japanese company’s chip unit. There has also been press speculation that numerous parties are said to be encouraging Toshiba to file for bankruptcy.
The session was heavy in terms of Japanese data releases, which included the June Jobless rate, CPI and Retail Sales. Further, June overall household spending saw its biggest rise since Aug 2015.
Nasdaq futures have declined by over 0.6%, as shares of Amazon fell over 2.5% after its earnings report. On the US health care front, the Senate released the text of their ‘Health-care Freedom Act’ and the US House conference is expected to hold a meeting on Friday at 9 AM EST.
Key economic data
(AU) AUSTRALIA Q2 PPI Q/Q: 0.5% V 0.5% PRIOR; Y/Y: 1.7% V 1.3% PRIOR
(CN) China Q2 Registered Urban Jobless Rate: 3.95% v 4.05% y/y
(JP) JAPAN JUN NATIONAL CPI Y/Y: 0.4% V 0.4%E ; CPI EX FRESH FOOD (CORE) Y/Y: 0.4% v 0.4%e; CPI Ex Food, Energy (core-core) Y/Y: 0.0% v -0.1%e
(JP) JAPAN JUL TOKYO CPI Y/Y: 0.1% V 0.1%E; CPI EX-FRESH FOOD Y/Y: 0.2% V 0.1%E
(JP) JAPAN JUN OVERALL HOUSEHOLD SPENDING Y/Y: 2.3% V 0.5%E (largest rise since Aug 2015)
(JP) JAPAN JUN RETAIL SALES M/M: 0.2% V 0.4%E;RETAIL TRADE Y/Y: 2.1% V 2.4%E
(JP) JAPAN JUN JOBLESS RATE: 2.8% V 3.0%E; Job to applicant: 1.51 v 1.50e
(JP) Bank of Japan (BOJ) Summary of Opinions for the July 19-20 policy meeting: Reiterates CPI likely to approach 2% around FY19; Repeated delays in price target could undermine BoJ’s credibility
(KR) SOUTH KOREA JUN INDUSTRIAL PRODUCTION M/M: -0.2% V 1.6%E; Y/Y: -0.3% V 1.1%E
(KR) South Korea Aug Business Manufacturing Survey: 78 v 80 prior; Non-Manufacturing Survey: 77 v 76 prior
(KR) South Korea June Cyclical Leading Index +0.3 pt m/m
(SG) Singapore Q2 Unemployment Rate: 2.2% v 2.3%e
(UK) JUL GFK CONSUMER CONFIDENCE: -12 V -11E
Speakers and Press
China
(CN) China fx regulator SAFE: Will safeguard and increase value of forex reserves
(CN) China banks said to be increasing rates on mortgages – Economic Information Daily
(CN) China National Energy Administration: Will not encourage solar power projects that require high subsidies and will discourage low-tech projects
Japan
(JP) Japan Chief Cabinet Sec Suga: Japan to impose additional sanctions on North Korea
(JP) Japan Defense Min Inada: Confirms resignation
(JP) Japan Foreign Minister Kishida expected to also take on role of Defense Minster – Japanese Media
Other
(NZ) RBNZ said its review found that the central bank’s mandate is realistic about what monetary policy can achieve
(US) US Senate Majority Leader McConnell: ‘Skinny Repeal’ healthcare plan would end individual mandate, provide flexibility to states; Says time to send Healthcare bill to President Trump.
(US) DoubleLine’s Gundlach purchased 5-month put options on the S&P 500 a couple of days ago – financial press
Asian Equity Indices/Futures (00:30ET)
Nikkei -0.7%, Hang Seng -0.6%, Shanghai Composite flat, ASX200 -1.5%, Kospi -1.4%
Equity Futures: S&P500 -0.4%; Nasdaq -0.6% , Dax -0.5% , FTSE100 -0.5%
FX ranges/Commodities/Fixed Income (00:30ET)
EUR 1.1671-1.1694; JPY 110.79-111.71; AUD 7953-7980; NZD 0.7475-0.7508
EUR/CHF: Rises over 0.6% to highest since Jan 2015
Aug Gold -0.1% at 1,258/oz; Aug Crude Oil -0.2% at $48.94/brl; Sept Copper -0.4% at $2.86/lb
(AU) Australia sells A$700M of May 2028 bonds, avg yield 2.7266% v 2.7747% prior, bid to cover 3.84x v 2.82x prior
(AU) Australia to sell A$900M of 2.75% Nov 2028 bonds on Aug 2 and A$500M in 1.75% Nov 2020 bonds on Aug 4th
(CN) PBOC SETS YUAN REFERENCE RATE AT: 6.7373 V 6.7307 PRIOR
(CN) China PBOC OMO injects CNY140B in 7-day and 14-day reverse repos v CNY60B prior in 7-day
Equities notable movers
Japan
Daiwa Securities, 8601.JP Q1 profits declined; -4%
Nissan, 7201.JP Q1 profits below ests; -3.5%
US markets on close: Dow +0.4%, S&P500 -0.1%, Nasdaq -0.6%, Russell -0.6%
Best Sector in S&P500: Energy +1%
Worst Sector in S&P500: Health Care -0.7%
At the close: VIX 10.11 (+0.51pts); Treasuries: 2-yr 1.37% (+2bps), 10-yr 2.33% (+4bps), 30-yr 2.94% (+5bps)
US Market Summary
The broad stock market and tech sector lost some high ground today, with transport and technology weighing on S&P and Nasdaq. The Dow outperformed again, setting another all-time high, with some help from the rally in Verizon +7.7%. The blue chip index touched a record high at 21,798. Focus turns to tomorrow, with more earnings reports and key GDP data in the morning.
US Afterhours Movers
SAM Reports Q2 $2.35 v $1.29e, Rev $247.9M v $229Me; Narrows higher FY17 $5.00-6.20 v $4.86e (prior FY17 $4.20-6.20); +13.4% afterhours
FSLR Reports Q2 $0.64 v -$0.05e, Rev $623M v $536Me; Raises FY17 Gross Margin 17-18% (prior 12.5-14.5%); +9.6% afterhours
BIDU Reports Q2 $2.36 adj v $1.42e, Rev $3.08B v $2.78Be; Guides Q3 Rev $3.41-3.50B v $3.17Be; +7.5% afterhours
LOGM Reports Q2 $1.01 v $0.93e, Rev $267M v $265Me; Guides Q3 $1.10-1.12 v $1.01e, R$271-273M v $268Me, Adjusted EBITDA $100-102M y/y ; +3.4% afterhours
SBUX Reports Q3 $0.55 v $0.55e, Rev $5.66B v $5.74Be; +0.9% afterhours
MAT Reports Q2 -$0.14 v -$0.08e, Rev $947.5M v $1.00Be; -2.8% afterhours
AMZN Reports Q2 $0.40 v $1.40e, Rev $38.0B v $37.2Be; Guides Q3 Rev $39.5-41.8B v $40.0Be ; -2.8% afterhours
FLEX Reports Q1 $0.24 v $0.26e, Rev $6.01B v $5.90Be; Guides Q2 $0.24-0.28 v $0.28e, R$5.9-6.3B v $6.19Be ; -7.8% afterhours
ELLI Reports Q2 $0.52 v $0.52e, Rev $104.1M v $110Me; -24.6% afterhours
