Asia Summary
Asian equity markets are trading generally higher, after most of the US stock indices ended in positive territory on Wednesday. The MSCI Asia Pacific Index has traded near fresh record highs.
The Nikkei 225 has rallied by over 2%. Index-component Fast Retailing has gained over 2.7%, while the overall TOPIX Retail Trade index has risen by more than 0.9%. The TOPIX Securities broker index has gained over 1.5%, amid the gains in the equity markets.
Japanese megabanks are also trading higher. Shares of Mitsubishi UFJ have risen by over 0.7%. In Hong Kong, the Hang Seng Financials index is higher by more than 0.5%, amid gains in the insurance sector. Earlier today, China’s insurance regulator, the CIRC, said Jan-Sept total premium income for the industry rose by 21% y/y
Shares of tech name, Tencent, have risen by over 1% and the overall Hang Seng Information Technology index has gained over 1%. Japanese video game maker, Square Enix, has gained over 5%, as Q2 earnings beat market expectations. Toshiba reiterated its FY outlook.
Large steelmakers in Japan are trading generally higher, following the losses seen on Wednesday, with shares of Nippon Steel up by over 3.5%. US Steel’s shares closed higher by over 1% in the NY session. In Australia, the ASX 200 Resources index has risen by over 0.8%. On Wednesday’s session, copper and gold futures ended the session higher. Shares of gold miner, Newcrest, are up over 0.5%. The ASX Utilities index is higher by over 0.5%.
Meanwhile, the ASX 200 REIT index has risen by over 1%, adding onto the gains seen in the prior session.
On the macro front, China’s Oct inflation data (CPI, PPI) were higher than expected. US President Trump said there was no more important subject than US-China relations, following his earlier meeting with China’s President Xi. Trump later said that the US trade deficit with China is ‘shockingly high.’
At the same time, a Chinese Commerce Ministry official said the two countries have signed over $253B worth of business deals, including in the semiconductor and auto industries.
In New Zealand, the Kiwi has declined by over 0.1%. Earlier today, the Reserve Bank of New Zealand (RBNZ) left its cash rate unchanged as expected and reiterated that policy would remain accommodative for a considerable period.
The Aussie has erased the declines seen after the weaker than expected Sept Home Loans data. Looking ahead, the Reserve Bank of Australia (RBA) is due to release its quarterly monetary policy statement and economic forecasts on Friday.
Key economic data
(CN) CHINA OCT CPI M/M: 0.1% V 0.2%E; Y/Y: 1.9% (highest since Jan reading of 2.5%) V 1.8%E; PPI Y/Y: 6.9% V 6.6%E
(NZ) NEW ZEALAND CENTRAL BANK (RBNZ) LEAVES CASH RATE (OCR) UNCHANGED AT 1.75%; AS EXPECTED
((JP) Japan Sept Current Account Balance: ¥2.27T v ¥2.36Te; Adj: ¥1.84T v ¥2.053Te; Trade Balance: ¥852.2B v ¥832.5Be
(JP) Bank of Japan (BOJ) Summary of Opinions at Oct. 30-31th Meeting: should maintain easing policies until the inflation mandated is achieved
(AU) Australia Sept Home Loans M/M: -2.3% v 2.0%e; Investment Lending: -6.2% v 4.3% prior
Speakers and Press
Japan
(JP) Bank of Japan (BOJ) Member Funo: Vital to keep pushing strong monetary easing; CPI to rise to 2% target and help stabilize FX
(JP) Japan LDP Tax Chief: Not considering high tax on cigarettes
Korea
(KR) Bank of Korea (BOK) quarterly monetary policy statement: economic expansion close to its potential growth rate and inflation near target, conditions are coming together for an adjustment to monetary policy
(KR) Pres Trump reiterates last night’s speech to Korean parliament via tweet: "NoKo has interpreted America’s past restraint as weakness. This would be a fatal miscalculation. Do not underestimate us. AND DO NOT TRY US." (US session)
Australia/New Zealand
(NZ) NEW ZEALAND CENTRAL BANK (RBNZ) GOV SPENCER: ECONOMIC OUTLOOK IS VERY POSITIVE OVERALL
(NZ) New Zealand Fin Min Robertson: Exact spending plans not finalized, need revenue and growth outlook for spending plan
(AU) Western Australia Treasurer Wyatt: begun talks with the gold industry in the state about a royalty hike for producers after an earlier proposal failed
(NZ) RBNZ McDermott: New Zealand Dollar (NZ$) ‘looks about right’; policy stance is ‘neutral’ though not ‘firmly neutral’
China/Hong Kong
(CN) China President Xi: Vast potential exists in China-US economic ties; China willing to significantly raise imports from the US
(US) US President Trump: No more important subject than US-China relations
(US) US State Dept: Confirms China sovereign wealth fund, CIC, and Goldman sign agreement to create China-US industrial cooperation fund
(CN) China securities regulator (CSRC) may focus on business sustainability as part of IPO review – Chinese Press
Asian Equity Indices/Futures (23:00ET)
Nikkei +1.8%, Hang Seng +0.9%; Shanghai Composite +0.0%; ASX200 +0.6%, Kospi +0.1%
Equity Futures: S&P500 +0.1%; Nasdaq100 +0.0%, Dax +0.2%; FTSE100 +0.3%
FX ranges/Commodities/Fixed Income (23:00ET)
EUR 1.600-1.1586; JPY 114.07-113.80; AUD 0.7689-0.7663;NZD 0.6972-0.6945
Dec Gold +0.3% at $1,281/oz; Dec Crude Oil +0.1% at $56.88/brl; Dec Copper -0.3% at $3.09/lb
(CN) PBoC OMO: injects CNY40B v CNY160B prior in 7-day, 14-day and 63-day reverse repos; Net drain CNY0B v drain CNY40B prior
(JP) Japan MoF sells ¥647.3B in 0.8% (0.8% prior) 30-yr bonds; Avg yield: 0.789% v 0.8810% prior; Bid to cover: 3.43x v 3.98x prior
USD/CNY *(CN) PBOC SETS YUAN REFERENCE RATE AT 6.6325 V 6.6277 PRIOR
Equities notable movers
PRR.AU To present new data from TACTI-mel Ph I clinical trial in Australia investigating use of eftilagimod alpha in combination with pembrolizumab (KEYTRUDA) in unresectable or metastatic melanoma patients; +7%
DCG.AU Awarded A$75M contract from BHP; +6.5%
6479.JP Reports H1 Net ¥34.3B v ¥12.8B y/y; Op ¥41.9B v ¥18.6B y/y; Rev ¥429.0B v ¥275.1B y/y; +12%
5871.TW Reports 9M Net NT$7.0B, +29% y/y; +9.5%
179.HK Reports H1 Net $140M v $121M y/y, Rev $1.53B v $1.37B y/y; -8.5%
