General Trend:
- Large HK banks (HSBC, Standard Chartered) opened higher after rising last week [reminder from last week: HSBC and Standard Chartered issued their support for the new Hong Kong security law – press]
- Airlines outperform in HK, US Dept. of Transportation confirmed it rescinded the order that banned Chinese passenger flight arrivals
- Geely rises over 2% after issuing May vehicle sales data
- Telecom Services and Financial firms are among the early gainers in Shanghai
- Airlines outperform in Japan amid plans to increase cargo flights; Banks also rise in Japan after the recent jump in Treasury yields, retail sector lags
- Samsung Electronics reverses opening gain ahead of court decision related to Vice Chairman
- Press comments on M&A speculation related to Gilead and AstraZeneca
- Oil rose over 2% after OPEC+ announced short-term deal, market pared gain at the London open
- China gov’t bond yields move off of session highs, PBOC announced plan to roll over certain MLF funds around June 15th; C.Bank allowed MLF funds to mature on today’s session [thus draining liquidity]
- Japan Q1 GDP revised higher on CAPEX
- Japan Economy Min: Japan economy likely hit bottom sometime between April and mid-May, Japan is not at a stage yet where we want to stimulate consumption
- NZ to remove all coronavirus-related restrictions from June 9th (Tuesday)
Headlines/Economic Data
Australia/New Zealand
- ASX 200 closed for holiday
- AIR.NZ Expect 2022 air passengers to be ~13M v 18M pre-coronavirus, will look to remove additional NZ$150M from wages expense
- (AU) Australia Govt extends Domestic Aviation Network Support (DANS) program to Sept 30th, 2020 and Regional Airline Network Support (RANS) to Dec 31,2020
- (NZ) New Zealand Q1 Value of all Buildings Q/Q: -5.7% v -3.0%e
- (AU) Australia May Port Hedland Iron Ore exports: 47.8Mt (record high) v 45.3Mt prior
Japan
- Nikkei 225 opened +1.1%
- (JP) JAPAN Q1 FINAL GDP Q/Q: -0.6% V -0.5%E; GDP ANNUALIZED Q/Q: -2.2% V -2.1%E
- (JP) Japan Econ Min Nishimura: Japan Economy likely hit bottom sometime between April and Mid May; Premature to focus on stimulating consumption, Japan still focusing on containment of coronavirus
- (JP) Japan Apr Current Account (BoP): ¥262.7B v ¥364Be; Adj Current Account: ¥252.4B v ¥942.2B prior
- (JP) Japan PM Abe cabinet approval rating -11ppt to 38% (lowest level since 2015) – Nikkei poll
- (JP) Japan Fin Min Aso: Japan is not currently considering cutting the consumption tax rate, sales tax will fund social security costs
Korea
- Kospi opened +1.6%
- (KR) North Korea Leader Kim attended Party Committee meeting (politburo) Sunday, did not mention inter-Korean relations – KCNA
- (KR) South Korea May Foreign Net investment in local stocks (KRW): -4.1T v -5.4T prior (4th consecutive month of selling)
- 003490.KR Govt to provide KRW1.0T in liquidity via govt guaranteed bonds, expected as soon as late June – Yonhap
- (KR) South Korea Unification Min: North Korea said to not be responding to calls from the South
China/Hong Kong
- Hang Seng opened +1.0%; Shanghai Composite opened +0.4%
- (CN) CHINA MAY FOREIGN RESERVES: $3.102T V $3.095TE; China FX Regulator (SAFE): Economic fundamentals and policy room will keep FX reserves stable
- (CN) CHINA MAY TRADE BALANCE: $62.9B V $40.0BE; May Trade Balance with US: $27.9B v $22.9B prior
- (CN) CHINA MAY TRADE BALANCE (CNY): 442.8B V 283.2BE
- (CN) China Vice Foreign Min: Will suspend debt repayments from 77 developing countries; China has fulfilled its responsibility as a big country through shipments of coronavirus pandemic goods to other countries; Relationship with most countries has improved since coronavirus outbreak
- (CN) China releases 4 chapter white paper on prevention, control and treatment efforts related to coronavirus called: “Fighting COVID-19: China in Action”
- NetEase, 9999.HK Prices 171.5M share IPO at HK$123/shr v HK$123/shr indicated
- (CN) China National Health Commission Coronavirus Update for June 4th: 4 additional cases (4 imported v 5 prior) v 6 prior; Additional deaths: 0 v 0 prior; Additional Asymptomatic cases: 2 v 5 prior
- (CN) China PBOC sets Yuan reference rate: 7.0882 v 7.0965 prior
- (CN) China PBOC to roll over Medium Term Lending Facility (MLF) around June 15th, size to be decided by market demand
- (CN) China PBoC Open Market Operation (OMO): Injects CNY120B in 7-day reverse repos v CNY150B prior; Net inject CNY120B v Net drain CNY150B prior
- (HK) Hong Kong Finance Chief Chan: Registration for cash handouts to begin on June 21st; Payments to commence July 8th
Other
- (IQ) Iraq Fin Min: Decision to join OPEC+ deal was correct, we have gained from price improvement under OPEC+ deal
- OPEC+ members agree to one month extension of 9.7M bpd oil production cuts; will review market later in June for a possible further extension – press
- 2330.TW Reported to be receiving extra orders from Apple, Qualcomm, and other companies – Press
North America
- (US) Fed Chair Powell expected to affirm full deployment of Fed liquidity backstop when he speaks after Fed meeting Wednesday – US financial press
- GILD AstraZeneca made a preliminary approach to merge with Gilead, no formal talks are currently talking place – US financial press
- GILD Follow Up: AstraZeneca said to be no longer interested in Gilead after prelim approach, will focus on its own pipeline and developing COVID-19 vaccine – UK press
Europe
- (UK) More than 500 companies in UK have issued challenges against UK quarantine – UK press
- (UK) PM Johnson has ordered accelerated re-opening to prevent possible loss of 3.0M jobs, to allow pubs, restaurants and weddings to re-open – press
Levels as of 1:15ET
- Hang Seng +0.1%; Shanghai Composite +0.3%; Kospi +0.1%; Nikkei225 +1.2%; ASX 200 closed
- Equity Futures: S&P500 +0.3%; Nasdaq100 +0.4%, Dax +0.4%; FTSE100 +0.1%
- EUR 1.1320-1.1285; JPY 109.69-109.38; AUD 0.7003-0.6966; NZD 0.6537-0.6505
- Commodity Futures: Gold +0.6% at $1,692/oz; Crude Oil +1.5% at $40.16/brl; Copper +0.3% at $2.54/lb
