General Trend:
- Asian equities trade generally higher, S&P500 and Nasdaq traded at record highs on Monday
- Toyota Motor rises after confirming investment in Uber
- China bank earnings in focus: Bank of China, Agbank and Construction Bank may report results later today
- PBoC continues to strengthen the yuan after resuming counter-cyclical factor
- New Zealand PM establishes panel to address declines in business confidence
- HKMA continues to intervene in order to support the HKD
Headlines/Economic Data
Australia/New Zealand
- ASX 200 opened +0.1%
- ASX 200 Financials index +1.3%, Resources +0.8%, Utilities +0.8%, REIT +0.6%; Telecom -2.2%
- (AU) Australia sells A$150M v A$150M indicated in Feb 2022 indexed bonds, avg yield 0.3481%, bid to cover: 5.0x
- (NZ) New Zealand PM Ardern: govt will not relax budgetary responsibility rules; establishes an advisory council amid weak business sentiment
China/Hong Kong
- Shanghai Composite opened +0.1%, Hang Seng +0.9%
- Hang Seng Materials index +1.4%, Info Tech +0.6%, Industrial Goods +0.6%, Energy +0.5%, Consumer Goods +0.4%, Financials +0.3%, Property/Construction flat; Services -0.4%
- (CN) CHINA PBOC SET YUAN REFERENCE RATE: 6.8052 V 6.8508 PRIOR (strengthens the CNY by the most since early June 2017)
- (CN) China Press Commentary: Reiterates yuan (CNY) exchange rate to keep stable
- (CN) China PBoC Open Market Operation (OMO): Skips OMO v skipped prior: Net: CNY50B drain v CNY120B drain prior
- (CN) China said to have proposed removing birth limits from law – Chinese Press
- (CN) China Agriculture Ministry: Recent rise in vegetable prices due to normal seasonal fluctuations
- (CN) China Dalian Commodity Exchange: To cut the trading limit and margin requirements for coke, coking coal and iron ore futures; effective from Aug 28th
Japan
- Nikkei 225 opened +0.7%
- TOPIX Marine Transportation index +2.9%, Securities +1.4%, Iron & Steel +1%, Electric Appliances +1%, Real Estate +0.9%; Retail Trade -0.5%
- Toyota Motor: Confirms $500M investment in Uber
- (JP) Japan to forgo expert panel for sales tax increase – Japanese Press
- (JP) Japan Fin Min Aso: Expects finance dialogue with China to produce results to pave the way for PM Abe’s visit to China later in 2018
Korea
- Kospi opened +0.6%
- (KR) South Korea Finance Ministry Releases Statement on Budget Plan: To issue up to KRW97.8T of government bonds in 2019; Plans 2019 budget with fiscal spending of KRW470.5T, +9.7% y/y (as speculated)
- (KR) South Korea Aug Consumer Confidence: 99.2 v 101.0 prior (falls for 3rd straight month, lowest reading since March 2017)
- (KR) South Korea sells KRW1.3T v KRW1.3T indicated in 30-year bonds: avg yield 2.30%
- (KR) South Korea: No change in plan for Sept summit between President Moon and North Korea leader Kim – South Korean press
North America
- US equity markets ended higher: Dow +1%, S&P500 +0.8%, Nasdaq +0.9%, Russell 2000 +0.2%
- S&P500 Financials +1.4%, Materials +1.3%
- Campbell Soup: Board is said to be expected to note that the company will not sell itself – NY Post
- (US) US and Mexico reach trade deal to replace NAFTA
- US White House: Trump and Canada Trudeau agreed to continue ‘productive’ trade talks: Trump and German Merkel agreed on more talks over US/EU trade barriers
Europe
- (FR) France PM Philippe has asked ministers to prepare contingency measures in the case of a ‘no-deal’ Brexit – financial press
- (DE) Political allies of Germany Chancellor Merkel reportedly calling for tax cuts as surplus widens – German press
- (UK) UK Trade Sec Liam Fox: Uncertainties include deteriorating US/China trade dispute: expects EU reply on UK proposals in Oct
Levels as of 01:30ET
- Nikkei 225, +0.2%, ASX 200 +0.7%, Hang Seng +0.2%; Shanghai Composite -0.2%; Kospi flat
- Equity Futures: S&P500 flat; Nasdaq100 flat, Dax flat; FTSE100 +0.6%
- EUR 1.1698-1.1669 ; JPY 111.37-110.98 ; AUD 0.7356-0.7326 ;NZD 0.6713-0.6683
- Aug Gold flat at $1,216/oz; Sept Crude Oil flat at $68.88/brl; Sept Copper -0.4% at $2.721 /lb
