Equity Indices Trade Mixed amid Holiday Impact and Recent Gains on Wall Street

Dec 28 21, 07:10 GMT

Asia Market Update: Equity indices trade mixed amid holiday impact and recent gains on Wall St.; Evergrande’s bond payment deadlines in focus.

General trend

PBOC increased OMO cash injection amid focus on year-end and Evergrande.
USD/JPY remained below ¥115.
2-year UST yield rises above 0.75% [highest since Mar 2020].
US Natural Gas FUTs extend gain.
US equity FUTs trade slightly lower in Asia.
Nikkei 225 has pared gain after rising over 1.4%; Exporters trade generally higher after the overnight rise in USD/JPY.
Hang Seng has traded slightly lower after the higher open; Casino and Tech names trade generally weaker [Macau casino names weaker on the report of the first omicron case in the gambling hub]; Property index rises.
Shanghai Composite ended morning trading slightly lower (-0.2%).
AU and NZ markets return from extended holiday on Wed.
South Korea ex-dividend date is on Wed (Dec 29th).

Headlines/Economic data

Australia/New Zealand

Japan

Nikkei 225 opened +1.0%.
(JP) JAPAN NOV JOBLESS RATE: 2.8% V 2.7%E, Job-To-Applicant Ratio: 1.15 v 1.16e, seasonally adj jobless rate M/M for the first time in 6-months.
(JP) JAPAN NOV PRELIMINARY INDUSTRIAL PRODUCTION M/M: 7.2% V 4.8%E (record high increase); Y/Y: 5.4% V 2.9%E; Dec production m/m: 1.6% (prior +2.1%); Japan Govt raises industrial production assessment.

7974.JP President Furukawa: Supply of Nintendo Switch may decline in 2022 due to global chip shortage and continued logistics issues – Japan press.
(JP) Japan Fin Min Suzuki: Prices still need to be watched closely, must watch inflation expectations on market, no plans at all now for an extra budget next year.

Korea

Kospi opened +0.2%.
(KR) South Korea Dec Consumer Confidence: 103.9 v 107.6 prior; Households’ inflation expectation for next 12 months: 2.6% v 2.7% prior.
005380.KR Suspends hydrogen car project for Genesis model (had the goal of launching in 2025) – Korean press.
015760.KR To raise household gas prices in May, July and Oct.
036460.KR Planning to raise prices in Q1 of 2022 – press.
(KR) South Korea Govt purchases 200Kt of rice to help stabilize prices – Yonhap.
(KR) South Korea Finance Ministry: To cut tariffs on ~90 products during 2022, to strengthen competitiveness of small businesses and stabilize prices of key materials – Press.

China/Hong Kong

Hang Seng opened +0.3%; Shanghai Composite opened +0.1%.
Evergrande [3333.HK] Said to have ~$255M in bond coupon payments due on Dec 28th (Tues) [~$50.4M relates to Jun 2023 USD bond, ~$204.8M relates to Jun 2025 USD bond].
(CN) China PBOC Open Market Operation (OMO): Sells CNY200B (largest in 2 months) in 7-day reverse repos v CNY50B prior; Net inject: CNY190B v CNY40B prior.
(HK) Macau reports its 1st imported omicron case.
(CN) China PBOC sets Yuan reference rate: 6.3728 v 6.3686 prior.
700.HK To only allow minors 1 hour of game playing each night over new year holiday – Sina.
(CN) China State Planner releases new negative list for foreign investment; Restrictions on foreign ownership in passenger car manufacturing are removed, effective 2022 – press.
(CN) According to Shanghai Securities News: China monetary policy in 2022 will focus on releasing liquidity from marginal easing into areas like small business.
(CN) China CICC: CSRC’s draft regulations stating that companies can list overseas as VIE if they register with regulators and meet compliance rules will help eliminate regulatory uncertainties facing both overseas-listed Chinese companies and investors.
(CN) China Govt to increase forex (FX) market monitoring in 2022 – financial press.

North America

(US) CDC shortens recommended time for isolation of people who test positive for COVID from 10 days to 5 days, if asymptomatic.

Europe

Levels as of 00:15ET

Hang Seng -0.1%; Shanghai Composite -0.2%; Kospi +0.1%; Nikkei225 +1.0%; ASX 200 closed for holiday.
Equity Futures: S&P500 -0.1%; Nasdaq100 -0.1%, Dax -0.2%; FTSE100 +0.1%.
EUR 1.1331-1.1318; JPY 114.94-114.76; AUD 0.7241-0.7229; NZD 0.6823-0.6805.
Commodity Futures: Gold +0.1% at $1,811/oz; Crude Oil +0.3% at $75.78/brl; Copper -0.4% at $4.45/lb.