Shanghai Composite zooms; RBA minutes imply continued easing bias

- (NZ) NEW ZEALAND Q2 2-YEAR INFLATION EXPECTATION: 1.85% V 1.80% PRIOR; 1-YEAR EXPECTATION: 1.32% V 1.11% PRIOR

- (NZ) NEW ZEALAND Q1 PPI OUTPUT Q/Q: -0.9% V -0.1% PRIOR; PPI INPUT Q/Q: -1.1% V -0.4% PRIOR

- (NZ) NEW ZEALAND APR ANZ JOB ADVERTISEMENTS M/M: -0.2% V -0.7% PRIOR; 2nd straight decline

- (AU) Australia Mar Conference Board Leading index m/m: -0.1% v 0.5% prior; first decline in 4 months

- (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence Index: 114.6 v 110.6 prior; Highest since Nov 2014

- (KR) South Korea Apr PPI Y/Y: -3.6% v -3.7% prior; 9th consecutive month of decline

Index Snapshot (as of 02:30 GMT)

- Nikkei225 +0.6%, S&P/ASX -0.1%, Kospi +0.4%, Shanghai Composite +1.9%, Hang Seng +0.2%, Jun S&P500 +0.1% at 2,128

Commodities/Fixed Income

- Jun gold -0.5% at $1,221/oz, Jul crude oil -0.1% at $60.21/brl, Jul copper flat at $2.91/lb

- GLD: SPDR Gold Trust ETF daily holdings fall 5.5 tonnes to 718.2 tonnes; lowest since Jan 15th

- SLV: iShares Silver Trust ETF daily holdings fall to 9,888 from 9,925; multi-month lows

- (CN) PBoC won't conduct open market operations (OMO) in today's session (9th consecutive halt)

- JGB: (JP) Japan MoF sells ¥2.30T in 0.1% (0.1% prior) 5-yr bonds; Avg yield: 0.10% v 0.081% prior; Bid-to-cover: 2.80x v 3.38x prior

Market Focal Points/FX

- Asia's main indices are higher nearly across the board, tracking a session of modest gains in the US hours. S&P500 hit new record highs while Treasuries fell, reversing some of the gains made on Friday. Some of the focus fell on the research paper from the San Francisco Fed, putting the post-adjustment US Q1 GDP around 1.8% rather than 0.2% as reported by the Commerce Dept. SF Fed also indicated that much of the Q1 weakness could be attributed to seasonality of adverse weather, implying the worries about the timing of Fed rate hikes after last week's soft US data may be overdone.

- Shanghai Composite was the clear outperformer, rising over 1% in the opening hour and then zooming to 2.7% rise entering its lunch break. Note the index was down for the past 2 sessions, and there's chatter the high-margin speculative buying is behind today's move. Investors are also reacting positively to China State Council unveiling its 2015 economic reform, pledging to focus on economic growth, deregulate central power, promote FX convertibility, loosen control of investment and boost reforms of SOE in key industries such as electricity.

- Reserve Bank of Australia unveiled its policy meeting minutes from earlier this month when RBA cut rates to 2% as expected. The minutes were largely dovish, stating the delay in GDP pickup would lead to higher unemployment rate as well as anticipating terms of trade to fall further. RBA also pointed to the timing of recovery in non-mining investment as key to the economy and expressed concern over China property market. Most importantly, RBA said the lack of policy guidance in the statement does not limit scope for further easing - comment that led to selling in AUD and a rebound in S&P/ASX. AUD/USD fell over 30pips on the comments below $0.7960.

- NZD trading was also volatile once again, initially falling 20pips below 0.7360 on PPI data but then spiking on quarterly release from the RBNZ by over 50pips above 0.7420. RBNZ put 2-year inflation expectation at 1.85% V 1.80% prior - the first increase in a year - though 2-year GDP and 90-day bill rate expectations were revised a bit lower.

Equities

US equities/ADRs:

- MOMO: Reports Q1 +$0.05 v -$0.06 y/y, R$26.3M v $5.4M y/y; +20.9% afterhours

- TTWO: Reports Q4 $0.49 v $0.26e, R$428M v $461Me; Announces 10M share buyback authorization (about 12% of outstanding); +7.0% afterhours

- A: Reports Q2 $0.38 v $0.39e, R$963M v $993Me; -3.8% afterhours

- URBN: Reports Q1 $0.25 v $0.30e, R$739M v $760Me; -16.4% afterhours

Notable movers by sector:

- Consumer discretionary: Esprit Holdings 330.HK -2.7% (profit warning); Beiqi Foton Motor Co 600166.CN +3.5% (sales tax exemption for new energy vehicle); Bega Cheese BGA.AU -3.1% (lowers guidance); COFCO Tunhe Co 600737.CN +3.1%, China Foods 506.HK +3.7% (clarification on COFCO restructuring)

- Financials: China overseas Land 688.HK +1.9% (Apr result); PICC Group 1339.HK +1.5% (YTD premium income); Huatai Securities 601688.CN +10.0% (Hong Kong IPO)

- Technology: Hangzhou Hikvision Digital Technology Co 002415.CN +4.1% (cooperation with Alibaba); Samsung Electronics 005930.KR +2.3% (speculation on Galaxy S6 Edge Plus release)

- Industrials: GrainCorp GNC.AU +1.1% (to expand malt production capacity)

- Utilities: Sinohydro Group Ltd 601669.CN +3.9% (YTD new contracts)