HomeContributorsFundamental AnalysisAsian Indices Generally Rise After Earlier Nasdaq Gain

Asian Indices Generally Rise After Earlier Nasdaq Gain

General Trend:

  • Hang Seng rises amid strength in the tech sector, Tencent jumps over 5% after Nasdaq rise
  • Shanghai Composite trades flat during morning after over 3% gain during prior session; Financials decline, while Industrials gain
  • Consumer Discretionary, Energy and Financial firms are among the gainers in Australia
  • Gainers in Japan include Electric Appliance cos. and retailers; Softbank tracks recent Nasdaq gain; Decliners in Japan include Iron/Steel cos and Financials
  • Companies expected to report during the NY morning include Coca-Cola, Lockheed Martin, Paccar, ProLogis, Philip Morris

Headlines/Economic Data

Australia/New Zealand

  • ASX 200 opened +0.1%
  • (AU) RESERVE BANK OF AUSTRALIA (RBA) GOV LOWE: POSSIBLE TO LOWER CASH RATE TO 10BPS, [but] judgement is that lower rates would have little benefit; Has not yet worked through Victoria impact on RBA forecasts; Balance sheet has expanded to A$280B, from A$180B prior to pandemic
  • BHP [BHP.AU]: Reports Q4 Waio Iron Ore Production: 75.6Mt v 71.0Mt y/y, Attributable Iron Ore Production: 66.7Mt v 62.6Mt y/y; Guides initial FY21 attributable iron ore production 244-253Mt, Waio iron ore production 276-286Mt; FY21 Copper production guidance 1.5-1.6Mt
  • (AU) RESERVE BANK OF AUSTRALIA (RBA) JULY MEETING MINUTES: Consumer spending in May and June stronger than expected; EXCHANGE RATE ALIGNED WITH MARKET FUNDAMENTALS; Reaffirmed the importance of the longstanding principle of separating monetary policy from the financing of government
  • (AU) Australia Treasurer Frydenberg: Confirms jobkeeper extension to cost ~A$16.0B, jobseeker program extension to cost ~A$3.8B
  • (AU) Victoria state reports 374 additional coronavirus cases v 275 prior
  • (NZ) New Zealand Jun Credit Card Spending M/M: 14.0% v 59.4% prior; Y/Y: -9.2% v -20.6% prior

China/Hong Kong

  • Hang Seng opened +1.5%, Shanghai Composite +0.5%
  • CanSino [6185.HK]: Comments on Phase 2 results related to coronavirus vaccine: Both doses of the vaccine induced significant neutralising antibody responses to live SARS-CoV-2, with GMTs of 19·5 (95% CI 16·8–22·7) and 18·3 (14·4–23·3) in participants receiving 1Ă—10 11 and 5Ă—10 10 viral particles, respectively
  • (US) Commerce Dept adds 11 Chinese entities to ‘entity list’ related to involvement in human rights abuses
  • (CN) China PBoC Open Market Operation (OMO): Injects CNY10B via 7-day reverse repos v Injects CNY100B via 7-day reverse repos prior; Net Drain CNY20B v Net injection CNY50B prior
  • (CN) China PBOC sets Yuan reference rate: 6.9862 v 6.9928 prior (Strongest fix since Mar 12th)
  • (CN) China Finance Ministry (MOF) Sells 10-year special treasury bonds avg yield 2.783% v 2.86%e

Japan

  • Nikkei 225 opened +0.3%
  • Z Holdings [4689.JP]: Hedge funds have asked Line Corp to clarify the details of its deal with Z holdings – Press
  • (JP) Japan Govt reported to be increasing its economic assessment for July – Press
  • *(JP) JAPAN JUN NATIONAL CPI Y/Y: 0.1% V 0.1%E; CPI EX-FRESH FOOD (CORE) Y/Y: 0.0% V -0.1%E
  • (JP) Tokyo reports ~230 new coronavirus cases
  • (JP) Japan MOF sells ÂĄ1.2T v ÂĄ1.2T indicated (ÂĄ900B prior) in 0.40% 20-year JGBs; avg yield 0.4160% v 0.386% prior; bid to cover 3.8x v 3.9x prior

Korea

  • Kospi opened +1%
  • (KR) South Korea Jul 1-20th Exports Y/Y -12.8% v -7.5% prior; Imports Y/Y -13.7% v -12.0% prior
  • (KR) South Korea June PPI Y/Y: -0.9% v -1.8% prior

Other Asia

  • (PH) Philippines central Bank (BSP): Cuts RRR of thrift banks by 100bps starting Jul 31st; Cuts reserve requirement ratio of Philippine Thrift Banks

North America

  • Vale: Reports Q2 iron ore production 67.6Mt v 64.1.0Mt y/y (69.0Mte); affirms FY20 iron ore production at 310-330Mt
  • (US) Senator Kennedy (R): To vote in favor of Shelton Fed nomination; thinks Shelton’s nomination will be confirmed by Senate committee; Senator Shelby (R) also says he will not block Shelton’s Fed nomination in committee

Europe

  • (EU) EU LEADER SUMMIT REACHES AGREEMENT ON €750B RECOVERY FUND
  • Logitech [LOGN.CH]: Reports Q1 $0.64v $0.34e, Rev $791.9M v $706Me; Raises FY21 Op $410-425M (prior $380-400M); Rev “+10-13%” (prior “mid-single digit growth”)
  • (EU) ECB Schnabel (Germany): Reiterates balance of risks still tilted to downside, ECB likely to use full PEPP if baseline outlook holds
  • AstraZeneca [AZN.UK]: STAT News’ Feuerstein: “I am NOT a vaccine expert but the Oxford-AZN data look mediocre to me — disappointing relative to all the hype coming into Monday. Is this how others more knowledgeable than me see it, too? What am I missing here?”

Levels as of 1:20 ET

  • Nikkei 225, +0.9%, ASX 200 +2.3% , Hang Seng +1.9%; Shanghai Composite flat ; Kospi +1.4%
  • Equity S&P500 Futures: +0.2%; Nasdaq100 +0.6%, Dax +0.5%; FTSE100 +0.4%
  • EUR 1.1469-1.1422 ; JPY 107.27-107.12 ; AUD 0.7036-0.7010 ;NZD 0.6590-0.6559
  • Gold +0.3% at $1,821/oz; Crude Oil +0.1% at $40.95/brl; Copper +0.4% at $2.9318/lb
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