Asian Equities Trade Generally Higher, Modest Rise Seen For USD Index

May 28 21, 06:33 GMT

General trend

Asian automakers generally track US gains.
Nikkei has outperformed as USD/JPY trades near ¥110 [Big components rise (Softbank Group, Fast Retailing); Automakers track strength in US autos].
S&P ASX 200 has extended gains after opening flat [Resources index rises over 2% amid strength in Chinese metals; Guidance from Inghams supports Consumer Staples index].
Shanghai Composite ended the morning session flat; Financials rise at the start of the afternoon session.
Hang Seng has remained higher, currently trades near the opening level [Property, Financial and Materials indices rise; JD Logistics rises over 13% in trading debut; Meituan is due to report earnings today].
Companies due to report during the NY morning include Big Lots, Hibbett Sporting Goods.

Headlines/Economic data

Australia/New Zealand

ASX 200 opened flat.
(AU) Australia sells A$1.0B v A$1.0B indicated in 4.75% April 2027 bonds, avg yield 0.8948%, bid to cover 2.1x.
(AU) Reserve Bank of Australia (RBA): Approved consultation on proposed package of policy actions related to bank retail payments; in general not proposing major reforms to the Bank’s retail payments regulation.
(NZ) Reserve Bank of New Zealand (RBNZ) Gov Orr: Reiterates downside risks have abated; Only seeing wage pressures in certain sectors; Sees dramatic slowing in Housing price growth to 0.
(NZ) New Zealand May Consumer Confidence: 114.0 v 115.4 prior.
(NZ) New Zealand Apr Jobs filled +0.3% m/m.

China/Hong Kong

Hang Seng opened +0.4%, Shanghai Composite +0.1%.
(CN) China PBOC sets Yuan reference rate: 6.3858 v 6.4030 prior (Strongest since May 24, 2018).
(CN) China PBoC: Current Forex market is balanced; exchange rate impacted by many factors; Exchange rate cannot be used to offset commodity price rise or spur exports.
(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.
(US) China competitiveness bill passes procedural hurdle in the Senate.
(CN) China Banking Regulator (CBIRC) issued final rules related to sales of wealth management products, expanded the rules to cover commercial banks and foreign-owned companies – Chinese press.
(CN) China has set up CNY70B worth of equity investment funds related to the reforming of state-owned companies – US financial press.

Japan

Nikkei 225 opened +1.3%.
(JP) Reportedly BOJ contemplating 6-month extension to Sept deadline for pandemic relief program as early as next rate review – Nikkei.
(JP) Japan Econ Min Nishimura: Confirms govt will seek to extend coronavirus state of emergency in Tokyo and additional prefectures until June 20th.
(JP) Bank of Japan (BOJ) reports FY20/21 Net ¥1.22T v ¥1.30T y/y, Op Rev ¥2.42T v ¥2.24T y/y.
(JP) JAPAN MAY TOKYO CPI Y/Y: -0.4% V -0.5%E; CPI (EX-FRESH FOOD) Y/Y: -0.2% V -0.2%E.
(JP) JAPAN APR JOBLESS RATE: 2.8% V 2.7%E.

Korea

Kospi opened +0.2%.
(KR) South Korea said to be extending tax cuts on passenger cars an additional 6-month – Press.

North America

(US) President Biden to propose a $6.0T budget for FY22 to boost middle class and increase infrastructure – financial press.
(US) Biden budget reportedly will assume capital gains tax rate raise began in late April; would limit investors’ ability to avoid it – press.
(US) Senate GOP releases $928B counteroffer infrastructure proposal.
(US) Kansas City Fed to hold Jackson Hole central bankers’ meeting in person this year – press.

Europe

(UK) BOE’s Vlieghe (dove): 1st rate rise is likely to become appropriate only well into 2022; Will not be a part of MPC when the time comes to raise rates (**Note: term ends in Aug) [from May 27th].
(UK) May Lloyds Business Barometer: 33 v 29 prior.

Levels as of 01:20 ET

Nikkei 225, +2.2%, ASX 200 +1.2% , Hang Seng +0.6%; Shanghai Composite +0.2% ; Kospi +0.9%.
Equity S&P500 Futures: +0.3%; Nasdaq100 +0.2%, Dax flat; FTSE100 +0.4%.
EUR 1.2196-1.2181 ; JPY 109.95-109.76 ; AUD 0.7748-0.7735 ;NZD 0.7297-0.7267.
Gold -0.1% at $1,893/oz; Crude Oil +0.5% at $67.20/brl; Copper -0.1% at $4.6653/lb.