HomeContributorsFundamental AnalysisModest Gains Generally Seen In Asia After Strength On Wall Street, Shanghai...

Modest Gains Generally Seen In Asia After Strength On Wall Street, Shanghai Outperforms

General trend

  • Shanghai Composite extends gain and outperforms [leaders included the IT, Consumer Staples and Financial indices]; No new headlines seen related to Huarong.
  • Hang Seng has also extended gains after the higher open [Financials trade generally higher].
  • Nikkei opened higher and is currently near the opening level.
  • S&P ASX 200 rose following the flat open [Resources index is gaining for the first time in 5 sessions].
  • RBNZ is due to hold policy decision on Wed (May 26th); NZ 10-yr yield declines ahead of decision.
  • Companies due to report during the NY morning include AutoZone, Cracker Barrel, Citi Trends, Tarena International, ViaSat.

Headlines/Economic data

Australia/New Zealand

  • ASX 200 opened 0.0%.
  • DVN.AU Cimic to acquire all remaining outstanding shares off market at A$0.24/shr, ~A$15.6M.
  • (AU) South Australia imposes new border restrictions with Victoria over Melbourne coronavirus cluster.
  • (AU) Reserve Bank of Australia (RBA): Excess cash at exchange settlement (ES) accounts at A$223.7B v A$222.6B prior (record high).
  • (AU) Australia sells A$150M v A$150M indicated in 1.25% Aug 2040 indexed bonds, avg yield 0.1663%, bid to cover 5.53x.
  • (AU) Australia total weekly payroll jobs change for Apr 24th to May 8th: -0.5% v +0.4% prior; Wages -1.3% v +0.3% prior.
  • (AU) Australia Apr Prelim Merchandise Trade Balance A$10.1B, Exports M/M: 0%, Imports M/M: -7%.

Japan

  • Nikkei 225 opened +0.5%.
  • (JP) US State Dept raises travel advisory to ‘Do Not Travel’ amid COVID-19 for Japan and Sri Lanka.
  • (JP) Japan to begin imposing a 3 day quarantine rule for travelers from the UK – Press.
  • (JP) Japan govt considering extending COVID emergency for Tokyo and eight other areas – Japanese press.
  • (JP) Japan said to be extending period of 0% loan program – Press.
  • (JP) Former BOJ gov Shirakawa op-ed: failure to reach inflation targets despite the presence of a targeting framework exposes the limitations in knowledge of inflation dynamics, traditional theoretical models have not worked – Nikkei.
  • 9449.JP Confirms to acquire YJFX trading platform for ÂĄ28.9B from Z Holdings.
  • (JP) Japan Labor Ministry to delay release of wage data, unable to determine when the data will be released; cites the need to ‘scrutinize’ certain figures – financial press.

Korea

  • Kospi opened +0.3%
  • (KR) South Korea May Consumer Confidence: 105.2 v 102.2 prior (~3 year high).

China/Hong Kong

  • Hang Seng opened +0.2%; Shanghai Composite opened +0.2%.
  • (CN) China NDRC unveils 5-year price mechanism reform plan; To strengthen management of market expectation on prices.
  • (CN) China PBOC Gov Yi Gang met with foreign bank delegation on Monday (May 24th); foreign banks’ business developments in China were said to have been discussed – US financial press (update).
  • (CN) China PBOC: To raise tolerance of bad loans in Ag sector, To encourage banks to issue Agricultural FInancial bonds.
  • Ant Financial: Microlending unit CNY18B ABS issuance was terminated.
  • (CN) China PBOC sets Yuan reference rate: 6.4283 v 6.4408 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.

Other

  • (SG) SINGAPORE FINAL Q1 GDP Q/Q: 3.1% V 2.7%E; Y/Y: 1.3% V 0.9%E; Maintains 2021 GDP at 4-6%.
  • (SG) Singapore Apr Industrial Production M/M: 1.0% v 1.0%e; Y/Y: 2.1% v 3.5%e.

North America

  • (US) Commerce Dept reaches final determination that dumping of vehicle and light truck tires is occurring from South Korea, Taiwan, Thailand, and Vietnam – press.
  • (US) Sen Wicker (R-MS): GOP could support a total $1.0T package for infrastructure.
  • (US) Fed’s George (non-voter): Flexible approach to policy will serve Fed well; hard to distinguish between one off bottlenecks’ and broad lack of capacity; inflation expectations have moved up, do not dismiss risk of higher inflation.
  • (US) SEMI Apr North America-based Manufacturers of Semi Equipment Billings: $3.41B, +4.1% m/m and +49.5% y/y.

Europe

  • (EU) EU Commission President Von Der Leyen: No alternative to full and correct implementation of Irish protocol in UK relations.
  • (UK) BOE’s Cunliffe: Emphasizes guidance that we will not tighten policy until we have clear evidence progress is being made in eliminating spare capacity – Testifying in Parliament.
  • (TR) Turkey has removed one of the 4 Central Bank (CBRT) Deputy Govs, Oguzhan Ozbas to be replaced by Semih Tumen (adviser to President Erdogan) – Turkish press.

Levels as of 01:20 ET

  • Nikkei 225, +0.5%, ASX 200 +0.7% , Hang Seng +1.4%; Shanghai Composite +1.9% ; Kospi +0.6%.
  • Equity S&P500 Futures: +0.2%; Nasdaq100 +0.3%, Dax -0.1%%; FTSE100 +0.2%.
  • EUR 1.2231-1.2211 ; JPY 108.86-108.68 ; AUD 0.7762-0.7745 ;NZD 0.7229-0.7204.
  • Gold -0.3% at $1,879/oz; Crude Oil +0.3% at $66.22/brl; Copper +0.8% at $4.5685/lb.

 

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