Asia Summary
Asian equity markets are trading generally higher following Monday’s gains in the NY trading session. The Nikkei 225 has traded at a 25-year high, as the Topix Securities broker index has risen by over 1%.
Australia’s ASX 200 index has traded at the highest level since Feb 2008. BHP and Rio Tinto have gained over 2%, and the overall ASX Resources index is up more than 1.5%.On yesterday’s session, copper prices rose by 1%, while oil prices gained over 3%.
With the recent gain in crude oil prices, the ASX and Hang Seng Energy indices have gained over 1% on the session.
The Hong Kong property, conglomerates and consumer goods indices are also currently gaining. South Korean department store operator, Shinsegae, has risen by over 7%, as its Q3 revenues rose by more than 34%.
South Korean chip makers are trading mixed. Shares of Samsung Electronics have gained on the session. Hynix has, however, lagged amid the earlier decline seen in the share price of Micron. Taiwan Semi is trading up by over 0.6%. In Q1, contract prices for DRAM may rise on demand from Apple, according to a Taiwanese press report. In Hong Kong, the Information Technology Index has gained over 0.5%, as shares of Tencent have risen by more than 1%. The company’s eBook business, China Literature, has risen by over 30% in the gray market ahead of its IPO in Hong Kong. Softbank has traded marginally lower, following its recent earnings report.
Steelmakers in Japan are trading mixed. Nippon Steel and JFE have gained over 1.5%, while shares of Kobe Steel have lagged. In the auto space, Toyota, has traded lower by over 0.6%, ahead of its later today earnings report. In Hong Kong, Geely Automobile has traded higher by over 3%, as it reported record vehicle sales for the month of October. The ASX 200 REIT index has gained over 0.9%
Australia’s 3-year bond yields are higher on the session and the Aussie is little changed amid the Reserve Bank of Australia’s decision to keep rates unchanged (as expected). The central bank, however, in its policy statement said core inflation is likely to remain low for some time on slow growth in labor costs and higher competitive pressures, particularly in retailing. The central bank also said one continuing source of uncertainty is the outlook for household consumption. These comments came, as Australia’s retail sales have missed market expectations for 3 straight months.
Looking ahead, the RBA is due to release its Quarterly Monetary Statement and economic forecasts on Friday’s session.
Japanese companies expected to report earnings later today include, Ajinomoto, Asahi Kasei Corp, Brother Industries, COMSYS Holdings, Daikin Industries, Fuji Oil Holdings, Istean Mitsukoshi Holdings, Kubota, Nikon Corp, NTT Data and Sumitomo Electric.
Key economic data
(AU) RESERVE BANK OF AUSTRALIA (RBA) LEAVES CASH RATE TARGET UNCHANGED AT 1.50%; AS EXPECTED (15TH CONSECUTIVE HOLD IN CURRENT EASING CYCLE)
(JP) Japan Sept Labor Cash Earnings Y/Y: 0.9% v 0.5%e; Real Cash Earnings Y/Y: -0.1% v -0.2%e
(AU) Australia Oct AiG Performance of Construction Index 53.2 v 54.7 prior
Speakers and Press
Japan
(JP) Japan Fin Min Aso: US forces are important for Japan security, will not pursue FTA to reduce US trade deficit
(JP) Japan Dep Chief Cabinet Sec Nishimura: Trump and Abe did not discuss any bilateral Free trade Agreement (FTA)
Korea
(KR) South Korea FX Official: Closely monitoring FX markets, FX policy stance stays the same as Fin Min comments last week
Australia/New Zealand
(NZ) New Zealand PM Arden: Not at all concerned about recent declines in NZ$
(NZ) New Zealand Fin Min Robertson: Expect business confidence to recover
(NZ) New Zealand Fin Min Robertson and acting Gov Spencer have signed an unchanged Policy Targets agreement (PTA)
(NZ) New Zealand Treasury: Q3 GDP may be 0.6%, slower than expected; GDP growth is expected to pick up in Q4 – Monthly Economic Indicators
China/Hong Kong
(CN) China Commerce Ministry (MOFCOM):foreign trade conditions are expected to be generally favorable in 2018 amid a steadily improving global economy
(CN) China Banking Association economist Ba Shusong: China should strengthen efforts to internationalize the yuan – China Financial News
Asian Equity Indices/Futures (23:00ET)
Nikkei +1.3%, Hang Seng +1.2%; Shanghai Composite +0.6%; ASX200 +0.8%, Kospi -0.1%
Equity Futures: S&P500 +0.1%; Nasdaq100 +0.2%, Dax +0.1%; FTSE100 +0.2%
FX ranges/Commodities/Fixed Income (23:00ET)
EUR 1.616-1.1602; JPY 113.94-113.70; AUD 0.7701-0.7679;NZD 0.6954-0.6933
Dec Gold -0.1% at $1,280/oz; Dec Crude Oil +0.1% at $57.41/brl; Dec Copper -0.2% at $3.15/lb
(CN) PBoC OMO: injects CNY180B in 7-day, 14-day and 63-day reverse repos prior v skips prior; Net drain CNY80B v injection CNY160B prior (1st injection after 3 consecutive skips)
USD/CNY *(CN) PBOC SETS YUAN REFERENCE RATE AT 6.6216 V 6.6247 PRIOR
(TH) Thailand Central Bank sells THB115B in 3-month, 6-month and 301-day central bank bonds
Equities notable movers
Australia/New Zealand
TWR.NZ Suncorp will not appeal NZCC’s decision to decline its application to acquire Tower; -6.8%
Japan
6005.JP Reports H1 Net ¥4.8B +25% y/y; Op ¥6.70B +15.8% y/y; +9.5%
6849.JP Reports H1 Net -¥546M v ¥1.7B y/y; Op ¥3.1B v ¥3.8B y/y; -6%
Korea
000720.KR Receives KRW582.06B contract in Busan; +8%
Hong Kong
1169.HK Controlling shareholder unit planning exchangeable bond sale; -4.4%
