Asia Summary
Asian equity markets opened mixed, with the biggest mover the Singapore Straits Times index falling 1.1%, led by banks. Most of the move is attributed to the fact that the odds for a Fed Dec rate hike his risen back up to 50/50 following US data. Late yesterday a PBOC adviser said that China is unlikely to raise rates or use RRR, more likely to use other measures. The PBOC did resume open market operations after skipping yesterday, with a next injection of CNY180B. An analyst report noted that China state owned firms are dominating M&A deals, accounting for 60% in H1 of 2017. As tensions continue to ease on the Korea peninsula, BOK Gov Lee and Fin Min Kim hold a meeting and jointly agree that any action from their respective offices will be harmonious. USD?KRW rose over 0.5% to 1,142 today.
Key economic data
(AU) AUSTRALIA JUL WESTPAC LEADING INDEX M/M: +0.12% V -0.14% PRIOR
(AU) AUSTRALIA Q2 WAGE PRICE INDEX Q/Q: 0.5% V 0.5%E; Y/Y: 1.9% V 1.9%E
(CN) China July yuan forex positions down CNY4.65B m/m to CNY21.5T
Speakers and Press
China/Hong Kong
(CN) According to Rhodium Group, China state-owned firms accounted for almost 60% of total M&A deal value in H1 – financial press
(CN) Moody’s: China non-performing loan (NPL) securitization performance solid, though information limited – Xinhua
(CN) PBOC Adviser: Cut of RRR is not in line with China’s policy, more likely to use SLF, MLF and PSL
Korea
(KR) US intel officials: North Korea has ability to produce missile engines and is not reliant on imports to do so – press
(KR) Bank of Korea (BOK) Gov Lee: Market volatility rising on North Korea risks; South Korea to put in efforts to stabilize markets
(KR) South Korea Fin Min Kim: Government will discuss with BOK and take "stern" action to stabilize markets if needed
Japan
(JP) Japan PM Abe: Govt is on high alert to deal with the possible threat faced by the prefectures over which North Korean missiles en route to Guam could fly
Asian Equity Indices/Futures (00:00ET)
Nikkei 0.0%, Hang Seng +0.5%, Shanghai Composite -0.2%, ASX200 0.0%, Kospi +0.5%
Equity Futures: S&P500 +0.4%; Nasdaq100 -0.1%, Dax -0.1%, FTSE100 -0.1%
FX ranges/Commodities/Fixed Income (00:00ET)
EUR 1.1746-1.1729; JPY 110.77-110.55; AUD 0.7838-0.7817; NZD 0.7241-0.7224
Dec Gold -0.1% at $1,278/oz; Sept Crude Oil +0.5% at $47.77/brl; Sept Copper +0.0% at $2.89/lb
(AU) Australia sells A$900M in 3.25% 2029 bonds; avg yield 2.7608%; bid-to-cover 2.96x
(JP) Bank of Japan (BoJ) announces expected purchase amounts for daily operation: Offers to purchase ¥440B in 5-10 yr JGBs v ¥470B prior
(CN) China PBoC OMO injects CNY280B v skips in 7 and 14-day reverse repos
USD/CNY *(CN) PBOC SETS YUAN REFERENCE RATE AT: 6.6779 V 6.6689 PRIOR
(KR) Bank of Korea sells KRW2.2T in 2-year monetary stabilization bonds at 1.74% v 1.64% prior
(CN) China sells 7-yr bonds; avg yield 3.6518%; bid-to-cover 2.89x
(TH) Thailand sells THB20B in 9.34-yr govt bonds; avg yield 2.4389%; bid-to-cover ratio 2.34x
Equities notable movers
Hong Kong/China
Carnival Group, 996.HK Announces rights offering to raise HK$1.72B; -12%
Geely, 175.HK Reports H1 (CNY) Net profit 4.34B v 4.04Be, Rev 39.4B v 18.1B y/y; +0.4%
Australia
Aveo Group, AOG.AU Reports FY17 adj Net A$252.8M, +118% y/y; FFO A%163.9M v A$141.3M y/y; Announces up to 54.3M share buyback; +10.5%
iSelect, ISU.AU Reports FY17 Net A$16.4M v A$18Me; EBIT A$22.5M v A$24Me; Rev A$185.1M v A$196Me; -14%
