General trend
- Nikkei has remained lower [Big components decline (Fast Retailing, Softbank Group); Financials trade generally lower, US DOJ said to start probe related to Archegos Capital; Topix Marine Transportation and Iron & Steel indices also decline; Air Transportation index outperforms].
- Shanghai Composite ended the morning session modestly higher after lower open [IT index outperforms; Financials decline after recent gains].
- Hang Seng has pared the opening decline [TECH index rises amid results from Xiaomi, Tencent declines after report related to financial holding co.; Lenovo beat tests].
- S&P ASX 200 has moved modestly higher after flat open [Resources index rises; Costa Group weighs on Consumer Staples index].
- NZX 50 weighed down by results from Fisher & Paykel Healthcare (largest component).
- South Korea bond yields rise then fall amid BOK decision/comments.
- China’s Commerce Ministry (MOFCOM) sometimes holds weekly news conferences on Thursday.
- Companies due to report during the NY morning include American Woodmark, Autohome, Best Buy, Burlington Stores, CIBC, Dollar General, Dollar Tree, Destination XL, Genesco, Medtronic, Movado, RBC, Sanderson Farms, TD Bank, Titan Machinery, Yunji.
Headlines/Economic data
Australia/New Zealand
- ASX 200 opened 0.0%.
- (NZ) Reserve Bank of New Zealand (RBNZ) Gov Orr: Reiterates willing to cut interest rates if needed, some extreme downside risks have abated; NZ labor market has been very resilient.
- (AU) Reserve Bank of Australia (RBA): Excess cash at exchange settlement (ES) accounts at A$228.1B v A$225.5B prior (Record high).
- (AU) Australia Victoria Acting Premier: Victoria to enter 7-day stage 3 lockdown (4th lockdown).
- (AU) AUSTRALIA Q1 PRIVATE CAPITAL EXPENDITURE Q/Q: 6.3% V 2.0%E.
Japan
- Nikkei 225 opened -0.4%
- (JP) Japan Govt said to be extending job subsidy program through end of July – Nikkei.
- (JP) Japan Investors Net Buying of Foreign Bonds: -¥551.5B v +¥600.2B prior; Foreign Net Buying of Japan Stocks: -¥223.5B v -¥471.4B prior.
- (JP) Japan MoF sells ¥500B v ¥500B indicated in 0.70% (prior 0.50%) 40-year JGBs, Yield at lowest accepted price 0.710% v 0.675% prior, bid to cover: 2.80x v 2.80x prior.
Korea
- Kospi opened +0.1%
- (KR) BANK OF KOREA (BOK) LEAVES 7-DAY REPO RATE UNCHANGED AT 0.50%; AS EXPECTED; raises 2021 GDP and CPI outlooks.
- (KR) BOK Gov: To maintain accommodative policy stance for a while; Should think about side effects from prolonged easing stance; Preparing for orderly normalization of monetary policy; Whether or not rate hike occurs this year depends on growth; Board debated at length on offering monetary signals.
- 000660.KR Said to establish China unit in Dalian to finalize purchase of Intel’s NAND unit – Korean press.
- (KR) South Korea Apr Department Store Sales Y/Y: 34.5% v 77.6% prior; Discount Store Sales Y/Y: -2.8% v 2.1% prior.
China/Hong Kong
- Hang Seng opened -0.6%; Shanghai Composite opened -0.2%.
- (CN) China Securities Times: Yuan (CNY) exchange rate should be decided by the market, notes PBOC has exited regular interventions in the yuan exchange rate, central bank has more tolerance for currency fluctuations.
- (CN) China PBOC sets Yuan reference rate: 6.4030 v 6.4099 prior.
- (CN) China PBOC Open Market Operation (OMO): Injects CNY10B in 7-day reverse repos v CNY10B in 7-day reverse repos prior; Net CNY0B v Net CNY0B prior.
- (CN) China Trade Minister Liu: Confirms to have held candid, constructive talks with US Counterpart, agreed to continue talks.
- (CN) China Apr Industrial Profits Y/Y: 57.0% v 92.3% prior.
- 2618.HK Confirms pricing IPO at HK$40.36/shr v HK$39.39-43.36/shr range indicated to raise HK$24.1B; Oversubscribed by ~716x, trading to start tomorrow.
- 1810.HK Reports Q1 (CNY) adj Net 6.07B v 2.30B y/y, Op 8.16B v 2.3B y/y; Rev 76.9B v 49.7B y/y.
- (CN) China PBOC to conduct CNY5.0B in 3-month Central Bank Bill Swap (CBS) operation on today’s session v CNY5.0B prior.
- (CN) China said to have asked 5 state owned companies to check into the usage of Crude Oil imports – Press.
- 992.HK Reports Q4 Net $260M v $43M y/y, Rev $15.6B v $10.6B y/y; raises dividend y/y.
Other
- ST.SG Reports FY20 (S$) underlying Net 1.73B v 2.46B y/y; EBITDA 3.8B v 4.5B y/y; Rev 15.6B v 16.5B y/y; sets new strategic direction to capture growth and unlock value.
North America
- (US) Trade Rep Tai: US-China phase 1 trade deal is very important, but only a part of the overall relationship with Beijing.
- (US) Fed’s Quarles (hawk, voter): time for discussing rate hikes is ‘far in the future’; inflation to meet the bar for tapering later this year but labor market improvement has been slower.
- (US) Said that the DOJ will begin a probe in Archegos Capital – Press.
- (US) Said that President Biden may extend infrastructure talks with Republicans by 1-2 weeks – Press.
- UBER To formally recognize GMB union in UK – press.
Europe
- (UK) Apr Car Manufacturing 68.3K units v 115.5K prior, y/y: +34.6K% v +46.6% prior; YTD Manufacturing 374.9K units v 306.6K prior, +17.3% y/y – SMMT.
- (FR) France Finance Min: Not far from global agreement on new tax rules at the level of the G7, G20, and OECD.
Levels as of 01:20 ET
- Nikkei 225, -0.6%, ASX 200 +0.2% , Hang Seng -0.4%; Shanghai Composite +0.2% ; Kospi -0.2%.
- Equity S&P500 Futures: -0.2%; Nasdaq100 -0.3%, Dax -0.1%; FTSE100 flat.
- EUR 1.2196-1.2175 ; JPY 109.20-109.04 ; AUD 0.7747-0.7722 ;NZD 0.7295-0.7265.
- Gold -0.1% at $1,898/oz; Crude Oil -0.5% at $65.87/brl; Copper +0.1% at $4.5263/lb.
