Asia Summary
Markets kick of the week mixed, over the weekend Venezuela held a vote that saw many dead, including a candidate, amid Venezuela protests during election for new legislative body that will reform constitution.US said to be considering oil-related sanctions against Venezuela, which could be announced by as early as today; not expected to include ban on Venezuelan oil shipments to the US. This saw crude futures rise as high as $50/bbl.
China July official manufacturing PMI came in at 51.4 slightly lower than expected and non-manufacturing PMI 54.5 also shy of expectations. Sub-component for construction rose to a high not seen since Dec 2013. China iron ore futures rose 7% early in the session; the strength in iron ore also pushed the major names in Australia higher.
Yen again pushed higher keeping pressure on the equities markets despite earnings season being in full swing. North Korea missile launch showed that it may be within striking range of US cities. South Korea and the US held a joint missile drill over the weekend. Elsewhere in geopolitical news Russia president Putin declared that Russia would kick out over 750 US diplomats by the end of Sept in retaliation to new sanctions.
Key economic data
(CN) CHINA JUL MANUFACTURING PMI (GOVT OFFICIAL): 51.4 V 51.5E; NON-MANUFACTURING PMI: 54.5 V 54.9 PRIOR
(NZ) NEW ZEALAND JUN BUILDING PERMITS M/M: -1.0% V 6.9% PRIOR
(JP) JAPAN JUN PRELIM INDUSTRIAL PRODUCTION M/M: 1.6% V 1.5%E; Y/Y: 4.9% V 4.8%E
(NZ) NEW ZEALAND JUL ANZ BUSINESS CONFIDENCE: 19.4 V 24.8 PRIOR; ACTIVITY OUTLOOK 40.3 V 42.8 PRIOR
(AU) AUSTRALIA JUN HIA NEW HOME SALES M/M: -6.9% V 1.1% PRIOR
Speakers and Press
China
(CN) China President Xi: China needs to speed up modernization of its military to fend off threats
(CN) China Commerce Ministry (MOFCOM): Irrational outbound investment ‘effectively curbed’
(CN) China State Researcher Long Guoqiang: US trade calculation exaggerates deficit with China
(CN) MSCI warns that companies in China that suspend trading in their shares for too long risk being dropped
(CN) Moody’s: Value of M&A transactions in China property sector is likely to reach a record high in 2017, following several major deals announced in July and Q2
Korea
(KR) South Korea and US conduct joint ballistic missile test (as announced earlier), in response to North Korea’s ICBM test; South Korea is expected to hold talks with the US military about the temporary installation of additional Thaad launchers, according to South Korea’s Defense Minister Song Young-moo
Japan
(JP) Japan PM Abe: After speaking with Pres Trump agreed more action needed on North Korea
Other
(SG) IMF raises Singapore’s 2017 GDP growth forecast to 2.3% v 2.2% seen in early May; Sees 2018 GDP growth at 2.5% – financial press
Asian Equity Indices/Futures (00:20ET)
Nikkei -0.1%, Hang Seng +0.8%, Shanghai Composite +0.6%, ASX200 +0.6%, Kospi -0.3%
Equity Futures: S&P500 -0.1%; Nasdaq -0.1%, Dax -0.1%, FTSE100 -0.1%
FX ranges/Commodities/Fixed Income (00:20ET)
EUR 1.1762-1.1732; JPY 110.72-110.31; AUD 0.7990-0.7956; NZD 0.7523-0.7499
Aug Gold -0.1% at 1,267/oz; Sept Crude Oil +0.4% at $49.91/brl; Sept Copper +0.5% at $2.89/lb
USD/CNY *(CN) PBOC SETS YUAN REFERENCE RATE AT: 6.7283 (strongest setting since Oct 14th, 2016) V 6.7373 PRIOR
(CN) China PBOC OMO injects CNY240B in 7-day and 14-day reverse repos v CNY140B prior in 7-day
(KR) South Korea sells 3-yr treasury bonds; avg yield 1.720%
(TH) Thailand sells THB5.0B in 3-month bills, avg yield 1.10140%
(HK) Hong Kong Overnight HIBOR rises to highest level since 2008
Equities notable movers
Hong Kong/China
Hutchison Telecom, 215.HK Agreed to sell Hutchison Telecommunications fixed-line phone business for HK$14.5B to private equity firm, I Squared Capital; +13%
Maanshan Iron & Steel,323.HK Gets approval for the listing of an investee company Anhui Xinchuang; +8.3%
Japan
Hitachi, 6501.JP Reports Q1 Net ¥75.1B v ¥34Be; Op ¥131.8B v ¥96Be; Rev ¥2.09T v ¥2.03Te; +5%
Isuzu, 7202.JP Isuzu expected to report a higher profit in June quarter, beating forecasts of a decline – Nikkei; +5%
Australia
Kogan.com, KGN.AU Entered into an agreement with The Hollard Insurance Company Pty Ltd for an initial period of three years to market a range of insurance offerings; 3 days of gains, +7.9%
Korea
Lotte Shopping, 023530.KR Reports Q2 (KRW) Net 4.16B v 82.3B y/y; -10%
Other
Sprint, S Charter affirms no interest in acquiring Sprint
CHTR Softbank’s Masayoshi Son said to be planning a direct offer for Charter – financial press
