General Trend:
- Decliners in Asia include travel-sensitive companies, energy firms and financials
- Australian equities underperform amid rise in virus cases in Victoria, Qantas plans to cut thousands of jobs
- Automakers and airlines trade generally lower in Japan, along with banks and real estate firms
- Nippon Steel declines by over 3.5%, Toyota said to have sold stake
- NEC rises on tie-up talks with NTT
Headlines/Economic Data
Australia/New Zealand
- ASX 200 opened -0.8%
- (AU) Australia Victoria State reports 33 additional coronavirus cases v 20 prior [overall Australia has largest daily rise in virus cases since April]
- (AU) Australia PM Morrison: Australia can respond to outbreaks and deal with them; Have confidence to move ahead (Comments amid 33 coronavirus cases reported in Victoria State)
- Qantas [QAN.AU]: Announces A$1.9B equity raising; Cutting 6k Jobs (~20% of total workforce), to also stand down ~15K workers; withdraws interim dividend
- (AU) Reserve Bank of Australia (RBA) adds A$4.95B to banking system through repos vs A$4.31B prior [largest daily injection since March 24th]
- (AU) Reserve Bank of Australia (RBA): Excess cash at exchange settlement (ES) accounts at A$38.0B v A$43.1B prior [lowest amount of excess cash since March 20th]
- (AU) Australia May Job Vacancies: -43.2% v -0.1% prior
- (NZ) New Zealand May Trade Balance (NZ$): 1.25B v 1.3Be
- (NZ) New Zealand Debt Management Office (DMO) sells NZ$1.05B v NZ$1.05B indicated in 2023, 2029 and 2037 bonds
China/Hong Kong
- Shanghai Composite closed for holiday between June 25-26th
- Hang Seng is closed for holiday, trading to resume on Friday (June 26th)
- (US) White House Adviser Navarro: Pres Trump today signed a proclamation to protect the US lobster industry; Considering tariffs on China seafood imports
- (US) Defense Dept releases list of Chinese companies designated as ‘owned or controlled by Chinese military,’ including Huawei, Hikvision, China Mobile, and other China telecom firms
- (US) White House National Security Adviser O’Brien said to warn of China bid to damage ‘our economies’ – US financial press
- (CN) China said to add World Bank official Yang Yingming to its trade talks team – financial press [China has yet to comment on the report]
- (CN) US Senator Cramer (R-ND) said to be holding up China bill for changes that would impose punishments on China over Hong Kong National Security Law; White House and US State Dept said to have proposed various technical corrections to the bill – HK Press
- (CN) China publishes its negative list for foreign investment for free trade zones (FTZs); effective July 23rd; Loosens entry to manufacturing and agriculture (June 24th)
- (CN) China 3rd week of June retail car sales -11% y/y – PCA (Industry association) [June 24th]
- (HK) HKMA said to sell HK$3.95B to defend peg as currency hits strong end of trading band
- (HK) Lawmakers in Hong Kong have canceled the vacancy tax bill related to property developers, says there was not enough time to examine the bill before the current legislative session ended – HK press (June 24th)
Japan
- Nikkei 225 opened -1.1%
- Softbank Group [9984.JP]: CEO: Equity Value of holdings recovered to pre-coronavirus levels; Shareholders should not expect dividends; to step down from board of Alibaba as of today – AGM
- (JP) Japan MoF sells ¥898.7B v ¥900B indicated in 0.40% 20-year bonds; avg yield 0.386% v 0.3350% prior; bid to cover 3.9x v 3.58x prior
- (JP) Bank of Japan (BOJ): Japan end of March (Q1) Household Assets: ¥1,845T, -0.5% y/y; BoJ holdings of JGBs: 44.2% v 43.7% q/q – Quarterly Flow of Funds Report
- (JP) Japan Investors Net Buying of Foreign Bonds: ¥1.54T v ¥1.66T prior week; Foreign Net Buying of Japan Stocks: -¥421.9B v -¥440.4B prior week
- (JP) Japan Apr All Industry Activity Index M/M: -6.4% v -6.5%e
Korea
- Kospi opened -1.4%
- (KR) South Korea Fin Min Hong: Confirms capital gains taxes will be applied on stock trading gains exceeding KRW20M/year in 2023; Will finalize new tax plan in July; Will adopt taxes on financial investments starting 2022 [this tax will apply to all financial investments]; Cutting stock transaction tax to 0.15% by 2023 [vs current level of 0.25%]
North America
- IMF TO UPDATE ITS WORLD ECONOMIC OUTLOOK (WEO): CUTS 2020 GLOBAL GDP FORECAST FROM -3.0% TO -4.9%
- (US) NY Gov Cuomo: New York, Connecticut, and New Jersey to impose quarantine-style restrictions on some visitors from Florida and other high-infection coronavirus states – press
- (US) Texas Gov Abbott (R): massive virus outbreak is sweeping the state
- (US) Reported ‘dozens’ of US Secret Service to quarantine after recent Tulsa Rally by US President Trump – Press
- (CA) FITCH DOWNGRADES CANADA SOVEREIGN RATING ONE NOTCH TO AA+ FROM AAA; OUTLOOK STABLE
- Disney [DIS]: Disneyland California reopening to be delayed
- MGM Resorts [MGM]: Announces extension of nationwide mandatory mask policy to guests and visitors its locations
- American Airlines [AAL]: Prices upsized $2.5B 11.5% senior secured notes due 2025 at 99% (45.4% of market cap); Will not proceed with $500M term loan facility
- (US) WHO’s Director Tedros: coronavirus cases to reach 10M worldwide within the next week (June 24th)
- (CL) Chuquicamata Copper mine (Chile) workers reported to seek 2-week shut down due to coronavirus death (Largest copper mine in the world)
Europe
- (US) USTR said to target $3.2B in new tariff targets on exports from France, Germany, Spain and the UK
Levels as of 1:20 ET
- Nikkei 225, -1.2%, ASX 200 -2.2% , Hang Seng closed; Shanghai Composite closed ; Kospi -2%
- Equity S&P500 Futures: -0.5%; Nasdaq100 -0.2%, Dax -0.3%; FTSE100 -0.5%
- EUR 1.1259-1.1240 ; JPY 107.26-106.88 ; AUD 0.6876-0.6849 ;NZD 0.6428-0.6399
- Gold flat at $1,774/oz; Crude Oil -0.3% at $37.89/brl; Copper -0.2% at $2.640/lb
