General Trend:
- Gaming firms outperform in HK, property index also rises
- Shanghai Composite rose by 0.8% during morning session; Consumer shares were among the early gainers
- Financials decline in Australia, while Energy shares rebound from recent losses
- Gainers in Japan include Air Transportation, Iron/Steel and Real Estate firms, Marine Transportation firms lag
Headlines/Economic Data
Australia/New Zealand
- ASX 200 opened +0.3%
- (AU) AUSTRALIA AUG PRELIMINARY CBA PMI MANUFACTURING: 53.9 V 54.0 PRIOR (3rd straight expansion); PMI Services: 48.1 v 58.2 prior (1st contraction in 3 months)
- (AU) Australia July Prelim Retail sales M/M: +3.3% v +2.7% prior, Y/Y +12.2%; Retail turnover rose in all states and territories except Victoria
- (AU) Victoria state (Australia) reports 179 additional coronavirus cases v 240 prior; 9 additional deaths (Lowest daily total since early July)
- (AU) Australia Debt Agency (AOFM): To sell New Nov 2031 bonds through Syndication next week; no Treasury bond tenders are planned for next week
- (AU) Australia sells A$2.0B v A$2.0B indicated in 0.25% Nov 2024 bonds, avg yield 0.3518% v 0.3383% prior, bid to cover 5.76x v 5.62x prior
- (AU) Reserve Bank of Australia (RBA) Gov Lowe: Calls for A$40B increase in spending by states (2% of Australia GDP) in order to support Australia Economy
- (NZ) Reserve Bank of New Zealand Official Buckle: We are facing considerable uncertainty; RBNZ has scope to act more aggressively if needed; Negative rate decision dependent on health of economy; The earliest RBNZ could implement negative rates operationally is early 2021
- (NZ) RBNZ Chief Economist Ha: Re-entering pandemic restrictions in Auckland played a part in August rate decision and projections; Central bank is watching labor market closely
- (NZ) New Zealand PM Ardern: New Zealand Cabinet to decide on August 24th (Monday) on Auckland Lockdown measures; has made good progress, not dealing with multiple outbreaks
- (NZ) Reserve Bank of New Zealand (RBNZ) buys NZ$240M v NZ$440M prior in government bonds as part of QE v NZ$240M sought
- (NZ) Reserve Bank of New Zealand (RBNZ): Will seek to purchase NZ$1.35B v NZ$940M prior in government bonds next week
- (NZ) New Zealand Debt Management Office (DMO) sells NZ$950M v NZ$950M indicated in 2025, 2029 and 2033 bonds
- (NZ) New Zealand July Credit Card Spending M/M: 1.8% v 14.0% prior; Y/Y: -5.8% v -9.2% prior
China/Hong Kong
- Hang Seng opened +0.9%, Shanghai Composite +0.5%
- Standard Chartered [2888.HK]: Hong Kong Justice Sec’s (Teresa Cheng Yeuk-wah) Standard Chartered mortgage is ‘under scrutiny’ amid US sanctions; HK’s Police Commissioner Chris Tang Ping-keung transferred his mortgage from HSBC to the Bank of China on Aug 4th amid the sanctions – SCMP
- (CN) China PBoC Open Market Operation (OMO): Injects CNY200B in 7-day reverse repos and 14-day reverse repos v Injects CNY160B in 7-day reverse repos prior; Net injection CNY50B v Net Injection CNY10B prior
- (CN) China Finance Ministry: Auctions 1-month deposits at 2.70% yield
- (CN) China Finance Ministry (MOF) sells 3-month and 6-month bills
- (CN) China Commerce Ministry (MOFCOM) spokesperson Geo Feng: China and US agree to have talk soon regarding trade (from Aug 20th)
- (CN) China PBOC sets Yuan reference rate: 6.9107 v 6.9274 prior
- (CN) China Supreme Court said to lower ceiling on private lending rates – financial press (from Aug 19th)
- (CN) China PBoC: To continue to use targeted easing and structural monetary tools to support medium-and small businesses (from Aug 20th)
- (CN) China new budget rules are reported to tighten the Local Govt Debt management; the new rules to take effect in Oct 2020 – Financial Press
- Ant Financial: Ant Group reported to target $225B valuation in dual listing [in line with prior reporting]; To target dual listing by as soon as October 2020; Said to target raising $30B in the dual IPOs.
Japan
- Nikkei 225 opened +0.6%
- Nippon Paint [4612.JP]: To be acquired by Wuthelam (largest shareholder) for ¥1.3T – Japanese press
- (JP) JAPAN JULY PRELIMINARY PMI MANUFACTURING: 46.6 V 42.6 PRIOR (16TH STRAIGHT CONTRACTION); PMI Services: 45.0 v 45.2 prior (7th straight contraction)
- (JP) JAPAN JULY NATIONAL CPI Y/Y: 0.3% V 0.3%E; CPI EX-FRESH FOOD (CORE) Y/Y: 0.0% V 0.1%E
- (JP) Japan Govt considers extending the cap of event sizes through end of Sept – Nikkei
- (JP) Japan may ease coronavirus entry restrictions on foreigners with residency status in September – Japan Press
Korea
- Kospi opened +1.4%
- (KR) South Korea confirms 324 additional coronavirus cases v 288 prior
- (KR) South Korea Vice Health Min Kim: More discussion is needed for 3rd level of social distancing; Current coronavirus situation does not meet requirement for level 3 distancing
- (KR) South Korea Aug 1-20th Exports Y/Y -7.0% v -12.8% prior; Imports Y/Y -12.8% v -13.7% prior; Chip exports +2.9% y/y
- (NK) North Korea leader Kim Jong Un said to retain absolute power but US and South Korea issues to be handled by his sister – financial press (from Aug 20th)
- (KR) South Korea July PPI M/M: +0.2% v +0.5% prior, Y/Y: -0.8% v -1.0% prior
North America
- Pfizer [PFE]: Confirms phase 1 data related to vaccine candidate against COVID-19 [BNT162b2]; affirms on track to seek regulatory review by as early as Oct 2020
- (US) ‘Top’ US FDA official Peter Marks ‘vowed’ to resign if Trump administration approves unproven COVID-19 vaccine – financial press
- (US) SEMI July North America-based Manufacturers of Semi Equipment Billings: $2.60B, +11.8% m/m and +27.6% y/y
Levels as of 1:20 ET
- Nikkei 225, +0.4%, ASX 200 flat , Hang Seng +1.4%; Shanghai Composite +0.7% ; Kospi +2.2%
- Equity S&P500 Futures: +0.2%; Nasdaq100 +0.2%, Dax +0.3%; FTSE100 +0.1%
- EUR 1.1878-1.1856 ; JPY 105.80-105.62 ; AUD 0.7216-0.7187 ;NZD 0.6547-0.6525
- Gold +0.6% at $1,957/oz; Crude Oil +0.2% at $42.92/brl; Copper +0.3% at $2.9995/lb
