Asia Tracks US Gains Amid Dearth Of Significant Fresh News

Jul 09 20, 06:28 GMT

General Trend:

Shanghai Composite rises 1% during morning session despite concerns in the local press about illegal margin lending; IT shares outperform, financials lag
Technology names trade generally higher in HK after the Nasdaq’s rise
Nikkei outperforms TOPIX ahead of earnings from Fast Retailing, Real Estate stocks drop in Japan; Softbank rises over 4% amid gains in the US tech sector and Alibaba
Japanese companies expected to report earnings after the market close include Fast Retailing (largest Nikkei component) and Seven & I
Gainers in Australia include Energy, Resource and Telecom companies
China’s Commerce Ministry (MOFCOM) sometimes holds weekly news conferences on Thursday

Headlines/Economic Data

Australia/New Zealand

ASX 200 opened +0.3%
(HK) Australia PM Morrison: To allow immigration program to offer opportunities to Hong Kong citizens; Australia will suspend Extradition treaty with Hong Kong (in line) – Statement on Hong Kong
*(AU) AUSTRALIA MAY HOME LOANS VALUE M/M: -11.6% V -5.5%E; INVESTMENT LENDING M/M: -15.6% V -4.2% PRIOR
(AU) Australia Jun Port Hedland Iron Ore exports: 51.8Mt (record high) v 47.8Mt prior (2 straight months of record exports)
(NZ) New Zealand Jul Prelim ANZ Business Confidence: -29.8 v -34.4 prior; Activity Outlook: -6.8 v -25.9 prior
(NZ) New Zealand Debt Management Office (DMO) sells NZ$950M v NZ$950M indicated in bonds due 2023, 2029 and 2033

China/Hong Kong

Hang Seng opened +0.9%, Shanghai Composite opened flat
Alibaba [9988.HK] Reportedly its financial arm Ant Financial considering IPO in Hong Kong, targeting >$200B valuation – press
(CN) China Securities Regulatory Commission (CSRC) is warning investors about illegally financed margin trading due to run up in China stock markets – Press
*(CN) CHINA JUN CPI M/M: -0.1% V -0.8% PRIOR; Y/Y: 2.5% V 2.5%E; PPI Y/Y: -3.0% v -3.2%e (prior largest drop since 2016)
(CN) China PBOC sets Yuan reference rate: 7.0085 v 7.0207 prior (Strongest fix since Mar 16th)
(CN) China PBoC Open Market Operation (OMO): Skips reverse repos v Skips prior; Net drain CNY0B v Net drain CNY0B prior (9th straight skip)
(CN) China Foreign Min Yi: Relationship is facing most serious challenges since relationship was established

Japan

Nikkei 225 opened flat
Softbank: Reported that Japan Mobile Unit is delaying bond offering – Press
(JP) Bank of Japan (BOJ) Gov Kuroda: CPI likely to be negative for time being; Japan economy is a ‘extremely’ severe situation; Will not hesitate to add easing
(JP) Tokyo reports at least 220 additional coronavirus cases
(JP) JAPAN MAY CORE MACHINE ORDERS M/M: +1.7% V -5.0%E; Y/Y: -16.3% V -16.8%E
(JP) Japan Jun M2 Money Supply Y/Y: 7.2% v 5.1% prior; M3 Money Supply Y/Y: 5.9% v 4.1% prior (fastest since comparable data became available in 2004)
(JP) Japan Jun Tokyo Avg Office Vacancies: 2.0% v 1.6% prior
(JP) Japan MoF sells ¥2.5T v ¥2.5T indicated (¥1.9T prior) in 0.10% 5-year JGB: avg yield -0.103% v -0.119% prior, bid to cover 4.25x v 3.78x prior
(JP) Tokyo Gov Koike: Tokyo coronavirus cases ‘very high’ today; More testing leading to more confirmed virus cases
(JP) Japan Economy Min Nishimura: Need to analyze whether coronavirus is spreading in Japan cities; No need to declare state of emergency (in line)

Korea

Kospi opened +0.6%
(KR) South Korea reported to be announcing tax hike for Koreans who own multiple homes – Korea Press
(KR) Recent satellite imagery reportedly shows activity at previously undeclared North Korean nuclear facility which researchers believe is being used to build nuclear warheads – CNN

Other Asia

(MY) Malaysia May Industrial Production Y/Y: -22.1% v -29.0%e
(SL) Sri Lanka Central Bank (CBSL) cuts Key Rates by 100bps (Market expected 50bps cut)
(TW) Taiwan reported to consider stopping Japan and Korea business travel into Taiwan, cited the recent rise in new coronavirus cases – Press

North America

United Continental [UAL]: Cancels US to Hong Kong flights through July 10th (Friday) citing medical testing changes imposed by China
Ford [F]: Q2 China vehicle sales 158.6K, +3.0% y/y – financial press
(US) Fed’s Rosengren (hawk, non-voter): Sees more US businesses needing rescue, Main Street lending facility may need to be extended – FT

Europe

Levels as of 1:20 ET

Nikkei 225, +0.6%, ASX 200 +0.9% , Hang Seng +0.4%; Shanghai Composite +1.4% ; Kospi +0.7%
Equity S&P500 Futures: -0.1%; Nasdaq100 flat, Dax +0.3%; FTSE100 +0.6%
EUR 1.1370-1.1327 ; JPY 107.36-107.18 ; AUD 0.6996-0.6968 ;NZD 0.6591-0.6562
Gold flat at $1,821/oz; Crude Oil -0.3% at $40.79/brl; Copper +1.2% at $2.8570/lb