Asia Summary
Asian equity markets opened mostly higher as the risk of conflict between North Korea and the US eased off after Kim Jong Un said he would hold off on an attack on Guam and wait to see how the US behaves before taking any action. This also helped to stabilize currencies in the region. However, a major mover was USD/PHP when it fell to an 11 year low at 51.155. AUD/USD rose slightly but little change in RBA meeting minutes and mixed earnings in Australia failed to give much push. China skipped open market operations but lent CNY399.5B in 1-year medium-term lending facility (MLF) loans at 3.2%, unchanged yield. PBOC also weakened the yuan setting for the first time in 6 days.
Key economic data
(AU) Australia ANZ Roy Morgan Weekly Consumer Confidence Index: 111.7 v 113.7 prior
(AU) AUSTRALIA JUL NEW MOTOR VEHICLE SALES M/M: -2.0% V 1.2% PRIOR; Y/Y: 1.8% V 3.6% PRIOR
(AU) RESERVE BANK OF AUSTRALIA (RBA) MEETING MINUTES: GDP GROWTH LIKELY PICKED UP IN Q2, ECONOMY SEEN GROWING AROUND 3% FOR 2018 AND 2019
(JP) Japan Jul Tokyo Condominium Sales y/y: +3.3% v -25.1% prior
Speakers and Press
China/Hong Kong
(CN) China Commerce Ministry (MOFCOM): Hopes US could be ‘prudent’ in review of China’s intellectual property (IP) policy; Will take steps if US takes actions that hurt bilateral trade relations
(CN) China National Energy Administration (NEA): China Jul power consumption: 607.2B KWH, +9.9% y/y (4th consecutive rise)
(CN) China Ministry of Commerce (MOFCOM): China will take actions to defend its interests if the US damages trade ties after President Donald Trump authorized an inquiry into China’s alleged theft of intellectual property
(CN) PBOC research bureau head Xu Zhong: Inclusion of banks negotiable certificates of deposit (NCD) in the PBOC’s macro-prudential assessment framework from Q1 2018 won’t have major impact on the nation’s banking system
(CN) China National Development and Reform Commission (NDRC) and other government agencies: China is holding back on building new coal-fired power plants to avoid risks from overcapacity and promote a clean energy mix
Australia/New Zealand
(NZ) New Zealand PM English: RBNZ does not need more housing tools; Want the RBNZ to remove loan-to-value ratios (LVRs) – NZ press
Korea
(KR) North Korea KCNA: US should stop its arrogant provocations; Kim Jung Un has discussed ground strike plan with officers
(KR) North Korea Kim Jong Un: Will not attack Guam yet, could change mind based on US actions
(KR) South Korea President Moon: Military action started on Korea peninsula can only be decided by South Korea, will prevent war at all means
Japan
(JP) Japan Fin Min Aso: Housing investment was the biggest driver of growth in Q2 GDP; rising domestic demand covered drop in external demand
Asian Equity Indices/Futures (00:00ET)
Nikkei +1.2%, Hang Seng +0.4%, Shanghai Composite +0.6%, ASX200 +0.7%, Kospi +0.0%
Equity Futures: S&P500 +0.3%; Nasdaq100 +0.5%, Dax +0.4%, FTSE100 +0.2%
FX ranges/Commodities/Fixed Income (00:00ET)
EUR 1.1793-1.1768; JPY 110.23-109.61; AUD 0.7877-0.7850; NZD 0.7312-0.7285
Dec Gold -0.7% at $1,281/oz; Sept Crude Oil +0.2% at $47.66/brl; Sept Copper +0.2% at $2.91/lb
USD/CNY (CN) PBOC SETS YUAN REFERENCE RATE AT: 6.6689 V 6.6601 PRIOR (1st weaker setting in 6 days)
(CN) PBoC lends CNY399.5B in 1-year medium-term lending facility (MLF) loans at 3.2%, unchanged yield; confirms that it skipped daily reverse repo operation
(TW) Taiwan sells NT$25B in 20-yr bonds; avg yield 1.591% v 1.798% prior; bid-to-cover 1.97x
Equities notable movers
Hong Kong/China
MMG, 1208.HK Reports prelim H1 Net $113M v -$93M y/y; -4.3%
Wheelock, 20.HK Reports H1 (HK$) Net 6.24B, +5.6% y/y; Rev 33.0B, +21.4% y/y; -4.2%
Japan
FujiFilm, 4901.JP Reports Q1 Net ¥43.8B v ¥12.1B y/y; Op ¥35.8B v ¥29.5B y/y; Rev ¥571.5B v ¥545.9B y/y; +7.5%
Australia
NRW Holdings, NWH.AU Announces 36.8M share purchase plan for existing shareholders at A$0.68/shr to raise A$25M towards the acquisition of Golding Group Pty Ltd; +30%
Domino’s Pizza Entertainment, DMP.AU Reports FY17 Underlying net A$118.5M v A$122Me; EBITDA A$230.9M v A$237Me; Rev A$1.07B v A$1.1Be; Announces A$300M buyback; -14%
