Asian Markets See Modest Losses After Declines On Wall Street

Jul 20 21, 06:27 GMT

General trend

Asian gov’t bond yields generally track Monday’s decline in UST yields.
Commodity currencies (AUD, NZD) extend declines.
US equity FUTs have remained higher in Asia, currently off of the best levels; Apple said to delay office return.
Asian equity markets opened modestly lower, in general.
Nikkei 225 has remained lower [Topix Banks index drops after declines in US financials; Canon rises on guidance].
Shanghai Composite ended morning trading lower by 0.5% [Decliners include Bank, Property and Consumer Discretionary indices].
Hang Seng has extended declines [Property names trade generally weaker amid focus on Evergrande; Financials also decline].
S&P ASX 200 has pared decline after dropping over 1% [Resources index has pared decline amid production update from BHP; Financials have also trimmed losses].
Companies due to report during the NY morning include Ally Financial, Halliburton, HCA, Manpower, Omnicom, Synovus Financial, Travelers.

Headlines/Economic data

Australia/New Zealand

ASX 200 opened 0.0%.
OSH.AU Recently received a confidential non-binding and indicative change of control proposal and rejected it.
BHP.AU Reports Q4 Waio Iron Ore Production: 72.8Mt v 75.6Mt y/y, Attributable Iron Ore Production: 65.2Mt v 66.7Mt y/y.
JBH.AU Reports Prelim FY21 (A$) EBIT 743.2M v 483.2M y/y, Rev 8.9B v 7.9B y/y.
OSH.AU Santos confirms all share merger proposal of A$4.25/shr.
(AU) Reserve Bank of Australia (RBA): Excess cash at exchange settlement (ES) accounts at A$337.4B v A$335.7B prior (record high).
(AU) South Australia to go into lockdown from today 18:00 for the next 7 days – local press.
(AU) RESERVE BANK OF AUSTRALIA (RBA) JULY MEETING MINUTES: Reiterates central scenario remained one where wages growth and underlying inflation were expected to increase only gradually over the subsequent 2 years, need to have flexibility to adjust weekly bond purchases.

Japan

Nikkei 225 opened -1.1%.
(JP) JAPAN JUN NATIONAL CPI Y/Y: 0.2% V 0.2%E; CPI EX-FRESH FOOD (CORE) Y/Y: 0.2% V 0.2%E; CPI Ex-fresh food/energy (Core-Core) Y/Y: -0.2% v -0.2%e.
(JP) Japan PM Suga: Will implement thorough COVID measures for safe and secure games.
(CN) Japan private school pension fund might purchase bonds from China – US financial press.
(JP) Japan government: On Aug 6th to release CPI data for Jan 2020 to Jun 2021 calculated under the new base year.
(JP) Japan Chief Cabinet Sec Kato: Japanese companies were targeted by cyberhacking group, Apt40, which is highly connected to China Govt.
(JP) Japan Jr Coalition Partner Komeito’s leader Yamaguchi: Want the Govt to offer quick aid to restaurants under lockdown and prevent any hospital bed shortage.
7751.JP Raises FY21 guidance Net to ¥201B; Op ¥283B; Rev ¥3.6T (Prior ¥140B; Op ¥198B; Rev ¥3.5T) (yesterday after the close).

Korea

Kospi opened -0.6%.
(KR) Unit of South Korea sailors recently sent to address pirating in Africa had 247 sailors of the 301 sent get infected with COVID.
(KR) South Korea Vice Foreign Min Choi: recent remarks by a senior Japan diplomats disparaging President Moon’s efforts to improve ties with Tokyo acted as a “significant obstacle” to Moon’s potential trip to Tokyo – Yonhap.

China/Hong Kong

Hang Seng opened -0.3%; Shanghai Composite opened -0.7%.
(CN) CHINA PBOC MONTHLY LOAN PRIME RATE (LPR) SETTING: LEAVES BOTH 1-YEAR AND 5-YEAR RATES UNCHANGED (15TH CONSECUTIVE MONTH OF STEADY RATES).
(CN) China may start relending policy for sectors related to carbon-reduction, other policies could include a ‘favorable’ reserve ratio (RRR) – Chinese press.
(CN) China PBOC sets Yuan reference rate: 6.4855 v 6.4700 prior.
(CN) China PBOC Open Market Operation (OMO): Injects CNY10B in 7-day reverse repos v CNY10B in 7-day reverse repos prior; Net CNY0B v Net CNY0B prior.
JIA Said to have halted plans for US IPO due to increased China Govt requirements for overseas IPOs – press.
(CN) China Agriculture Ministry: End-Jun pig herd at 99.4% of levels at end of 2017; sow herd at 102% of end of 2017 levels.

North America

AAPL To postpone return to office until earliest October, due to COVID, will give 1 month notice before return – press.
(CN) US and a coalition of allies said to accuse China’s Ministry of State Security of a global cyber hacking campaign – press (US session).
(US) Sen Maj Leader Schumer: To have procedural vote on Wednesday on bipartisan $1.2T infrastructure bill, do not have to have every detail of bill worked out by Wednesday.
CMCSA CEO said to have met with ViacomCBS Chairwoman in late Jun in relation to international streaming partnership – US financial press.

Europe

(UK) PM Johnson to announce increase to national insurance premiums – UK press.
UBSG.CH Reports Q2 Net $2.0B v $1.2B y/y, Adj PBT $2.6B v $1.6B y/y, Rev $8.98B v $7.4B y/y, to buyback $600M in shares in Q3 (under existing buyback program).
(UK) BOE’s Mann: UK recovery is more fragile than it appears; Do not see inflation becoming a spiral, we should not be premature on tightening (US session).

Levels as of 01:15ET

Hang Seng -0.9%; Shanghai Composite -0.4%; Kospi -0.6%; Nikkei225 -0.8%; ASX 200 -0.6%.
Equity Futures: S&P500 +0.3%; Nasdaq100 +0.5%, Dax +0.2%; FTSE100 +0.1%.
EUR 1.1803-1.1787; JPY 109.61-109.38 ;AUD 0.7358-0.7317; NZD 0.6955-0.6902.
Commodity Futures: Gold +0.5% at $1,818/oz; Crude Oil +0.4% at $66.61/brl; Copper +0.6% at $4.22/lb.