Asian Indices Trade Mixed, Precious Metals Rise As USD Index FUTs Extend Losses

Jul 27 20, 06:54 GMT

General Trend:

Japan equity markets opened lower after 2-day holiday; Decliners include Transports, Iron/Steel firms and Brokers ; Insurers outperform
Shanghai Composite trades flat during morning session after dropping over 3.8% on Friday, Kweichow Moutai rises over 1%
Shanghai property and financial firms trade lower
Financials trade mixed in HK, property index and gaming firms decline; HK confirms new measures to deal with coronavirus
Gainers in Australia include gold miners, financials lag
Lynas Corp (Aussie rare earths miner) rises over 10%, signed contract with US DoD related to US separation facility
Qantas sees less of its pilots return amid recent lockdown measures in Melbourne
Australia’s Perpetual acquires stake in US-based asset manager
TAIEX rises by over 2.5%; Taiwan Semi rises over 9.5% [in line with Friday’s move in the co’s ADRs]
US closed consulate office in Chengdu, China closed its consulate office in Houston; Some now wonder what happens next?
Some press focus on US Treasury Dept.’s currency report
Australia APRA (regulator) is expected to update its capital management guidance for banks this week

Headlines/Economic Data

Australia/New Zealand

ASX 200 opened flat
(AU) Reserve Bank of Australia (RBA) Assist Gov Kent: New policy measures are not under consideration
(AU) Australia launches 2051 bond syndicate (as expected): Coupon 1.75%; pricing guidance is 98-105bps/Australia 10 year Treasury FUTs
(AU) Reserve Bank of Australia (RBA) adds A$1.08B to the banking system v A$2.98B prior; Excess cash at exchange settlement (ES) accounts at A$42.4B v A$50.9B prior
(AU) Victoria state reports 532 coronavirus cases (record high) v 357 prior; 6 additional coronavirus deaths

China/Hong Kong

Hang Seng opened +0.8%, Shanghai Composite +0.4%
(HK) US Currency report may target China and Hong Kong – Financial press headline [Note: The source of the comment is not immediately clear]
(CN) China PBOC sets Yuan reference rate: 7.0029 v 6.9938 prior
(CN) US closes consulate in Chengdu, Flag reported as being lowered – Press [in line order from China]
(HK) Hong Kong EXCO confirms plan to ban all dine-in restaurant service, and to require all residents to wear a mask at all times while outside beginning Wed (July 29th)
(CN) China National Health Commission Coronavirus Update for July 26th: 61 additional cases v 46 prior; Additional deaths: 0 v 0 prior; Xinjiang reports 41 additional coronavirus cases
(CN) China approves an additional import quota amount of 10.1Kt of copper scrap metal
(CN) China Jun Industrial Profits Y/Y: 11.5% v 6.0% prior
(CN) Shanghai Exchange Margin Balance -1.0% v +0.6% prior
(CN) China PBoC Open Market Operation (OMO): Injects CNY100B in 7-day reverse repos v Skips repos prior; Net injection CNY0B v Net drain CNY200B prior

Japan

Nikkei opened -1.1% [returned from 2-day holiday]
*(JP) JAPAN Q1 FINAL CAPITAL SPENDING (CAPEX) Y/Y: 0.1% V 4.3% Prelim ; CAPITAL SPENDING EX-SOFTWARE: -1.4% V +3.5% Prelim [downward revision]
(JP) Bank of Japan (BOJ) Summary of Opinions for July 14-15th policy meeting: Need to watch policy impacts for time being
(JP) Tokyo Gov Koike: Tokyo did not find ‘many’ new coronavirus cases today
(JP) Japan reported to have asked its companies to adopt a 70% work from home rate – Press
(JP) Japan to create ‘framework’ to support shipbuilding cos. – Japanese press
(JP) Japan Chief Cabinet Sec Suga: Reiterates Japan coronavirus situation does not need an emergency declaration
(JP) Japan May All Industry Activity Index M/M: -3.5% v -3.5%e
(JP) Japan May Final Leading Index CI: 78.4 v 79.3 prelim; Coincident Index: 73.4 v 74.6 prelim

Korea

Other Asia

Taiwan Semi [2330.TW] : Receives order from Intel for 180K units of 6nm chips; AMD also increased its 7nm order with TSMC to 200K units – Taiwanese press
Taiwan Semi [2330.TW]: Apple sets up R&D area for Display tech at Taiwan Semi plant [Longtan plant] – Press
(VN) Vietnam PM: To order tougher social distancing measures in Da Nang

North America

Moderna [MRNA]: Expands BARDA Agreement to support larger Phase 3 Program for Vaccine (mRNA-1273) against COVID-19 with July 27 start date

Europe

SAP [SAP.DE]: To spin off Qualtrics through US IPO, to retain majority ownership of the unit; transaction is not expected to have an impact on 2020 or longer-term financial targets
(UK) Chancellor of the Exchequer Sunak (Fin Min): Reported to be considering an online sales tax – press

Levels as of 1:20 ET

Nikkei 225, -0.2%, ASX 200 +0.2% , Hang Seng -0.3%; Shanghai Composite -0.1% ; Kospi +0.7%
Equity S&P500 Futures: +0.5%; Nasdaq100 +0.6%, Dax +0.3%; FTSE100 +0.4%
EUR 1.1724-1.1642 ; JPY 106.13-105.45 ; AUD 0.7196-0.7087 ;NZD 0.6682-0.6626
Gold +1.6% at $1,927/oz; Crude Oil -0.1% at $41.27/brl; Copper +0.4% at $2.9072/lb