General Trend:
- Australia ASX 200 underperforms amid the focus on earnings; Telecom index drops after earnings from Telstra; Utilities index drops after earnings from AGL Energy; Banks also decline
- Earnings from Treasury Wine Estates support Australia’s Consumer Staples index
- Japanese equities outperform; Gainers include exporters, retail firms and financials
- Decliners in Hong Kong include Financial and Property cos.
- Tencent opened higher after earnings, then declined
- China Unicom rises over 20% amid earnings report
- China Mobile reported decline in H1 EBITDA, revenues rose
- Shanghai Composite traded flat during morning session; Decliners included financials and IT cos.
- Shares of CanSino (developing potential coronavirus vaccine) rose over 100% in Shanghai STAR board debut
- US 30-year Treasury FUTs rise in Asia; There is speculation that the PBOC may have purchased government bonds (financial press)
- China’s Commerce Ministry (MOFCOM) sometimes holds weekly news conferences on Thursday
- China Jul data points (including industrial production) are due on Friday (Aug 14th)
- US/China officials plan to meet in order to assess trade deal progression on Aug 15th (Saturday)
Headlines/Economic Data
Australia/New Zealand
- ASX 200 opened +0.1%
- (AU) AUSTRALIA JULY EMPLOYMENT CHANGE: 114.7K V 30.0KE; UNEMPLOYMENT RATE: 7.5% V 7.8%E; August Labour Force data will provide the first indication of the impact of Stage 4 restrictions [in Victoria]
- (AU) Australia Aug Consumer Inflation Expectation Survey: 3.3% v 3.2% prior
- (AU) Reserve Bank of Australia (RBA) offers to buy total of A$2.0B in bonds v A$2.0B prior
- (NZ) Reserve Bank of New Zealand (RBNZ) Deputy Gov Bascand: Resurgence of Coronavirus in New Zealand is a big risk to outlook; Will probably do combo of Negative OCR and Funding for lending program if additional stimulus needed
- (NZ) Reserve Bank of New Zealand (RBNZ) Chief Economist Yuong Ha: Wants to see NZD weaker, Negative rate policy option is not inevitable
- (NZ) New Zealand PM Ardern: Expects NZ coronavirus infection cluster to get worse before it gets better
- (NZ) New Zealand Health Official Bloomfield: confirms 13 additional coronavirus cases in community v 5 prior, 36 total active coronavirus cases in New Zealand
- (NZ) New Zealand Debt Management Office (DMO) sells NZ$950M v NZ$950M indicated in 2025, 2031 and 2037 bonds
China/Hong Kong
- Hang Seng opened +1%, Shanghai Composite +0.3%
- (CN) Clearing data said to suggest the China PBOC is buying government bonds – financial press
- (US) China said to discuss agricultural goods and CNY currency (Yuan) in upcoming US-China discussions planned for Aug 15th – financial press (from Aug 12th)
- (CN) China reported to be looking at increasing Company direct financing, cites the China Banking Insurance Regulatory Commission (CBIRC) Chairman Guo Shuqing and the PBOC party chief; The policies would be aimed at supporting the services sector and the economy. – China Press
- (BR) China Shenzhen province reported to have found a case of coronavirus in a frozen poultry product imported from Brazil [sample of frozen chicken wings] – Press
- (HK) Hong Kong police credit union said to shift billions (~HK$11.0B) in assets to mainland China banks, cited exposure to US sanctions – SCMP
- (CN) China said tighten bond rules in the interbank market related to property developers; the move is seen as an attempt to cut the debt levels of these companies – financial press
- (CN) China Aviation Regulator: Jul Passengers Y/Y: -34.1% v -42.4% prior
- (CN) China PBoC Open Market Operation (OMO): Injects CNY150B in 7-day reverse repos v Injects CNY140B in 7-day reverse repos prior; Net Injection CNY150B v Net injection CNY140B prior
- (CN) China PBOC sets Yuan reference rate: 6.9429 v 6.9597 prior
- (CN) China State Council: To widen market access of foreign meat and dairy products, to boost imports to ensure domestic supply (from Aug 12th)
- (CN) China said to increase credit support for SME trading companies – financial press (from Aug 12th)
- (CN) China auditors said to warn local governments of new debt-related risks , the risks relate to the underreporting of ‘hidden’ debts and the usage of special bonds- Chinese press
- (CN) China CBIRC Head Regulator issues warning of rising bad assets and other risks in China – Press
- (CN) China PBoC sells CNY30B v CNY30B indicated in 3-month and 1-year in Hong Kong
Japan
- Nikkei 225 opened +1.2%
- (JP) Japan July PPI M/M: 0.6% v 0.4%e; Y/Y: -0.9% v -1.1%e
Korea
- Kospi opened +0.9%
North America
- (US) Treasury Sec Mnuchin: confirms spoke with Speaker Pelosi earlier today; Democrats have ‘no interest in negotiating’
Europe
- USTR: EU and member states have not taken the actions necessary to come into compliance with the WTO decision in the Airbus/Boeing case
- (UK) July RICS House Price Balance: +12% v -5%e
Levels as of 1:20 ET
- Nikkei 225, +1.9%, ASX 200 -0.7% , Hang Seng -0.1%; Shanghai Composite +0.4% ; Kospi +0.6%
- Equity S&P500 Futures: flat; Nasdaq100 -0.1%, Dax flat; FTSE100 -0.6%
- EUR 1.1817-1.1780 ; JPY 106.92-106.60 ; AUD 0.7189-0.7155 ;NZD 0.6599-0.6564
- Gold -0.4% at $1,942/oz; Crude Oil -0.1% at $42.62/brl; Copper -0.3% at $2.8723/lb
