Asian Market Update: Samsung prelim Q2 rev misses estimates; Markets not convinced as 3 central banks take action


Economic Data

- (JP) JAPAN JUN OFFICIAL RESERVE ASSETS: $1.27T V $1.28T PRIOR (2nd consecutive decline)

- (AU) AUSTRALIA JUN AIG PERFORMANCE OF CONSTRUCTION INDEX: 34.8 V 34.7 PRIOR (25th month of contraction)

- (JP) JAPAN MAY PRELIMINARY LEADING INDEX: 95.9 V 95.0E; COINCIDENT INDEX: 95.8 V 95.9E

- (PH) PHILIPPINES JUN FOREIGN RESERVES: $76.3B V $76.0B PRIOR

- (US) US JUNE MONSTER EMPLOYMENT INDEX M/M: 153 V 147 PRIOR (V 146 Y/Y)

- (EU) EU JUNE MONSTER EMPLOYMENT INDEX M/M: 142 V 143 PRIOR (V 140 Y/Y)

- (CO) COLOMBIA JUN CPI M/M: 0.3% V 0.2%E; Y/Y: 3.4% V 3.3%E

- (NZ) New Zealand Govt Financial Statements for 11-months to end of May: Operating at deficit of NZ$5.91B before gains/losses

- (MX) Mexico Banamex Survey: Sees 2012 GDP at 3.7% (3.30% seen on March 29th); end of 2012 CPI at 3.81% (3.71% seen on Mar 29th)


Markets Snapshot (as of 04:30GMT)

- Nikkei225 -0.6%

- S&P/ASX -0.4%

- Kospi -1.1%

- Taiwan's Taiex -0.8%

- Singapore Straits Times -0.4%

- Shanghai Composite -0.5%

- Hang Seng -0.4%

- Sept S&P -0.2%

- Aug gold -0.3% at $1,604/oz

- Aug Crude oil -1.2% at $86.18/brl


Overview/Top Headlines

- Asian markets were unimpressed with central bank action in the EU, UK and China. Concerns center on if the rate cuts from China and the ECB and increased bond buying in the UK will be enough to spur the ever slowing economic growth back to health. Markets also remain soft ahead of US payrolls in the morning.

- Currencies were fairly static, EUR/USD at $1.2380 at the mid-point, yen traded around ¥79.90, the bigger mover was AUD/USD at A$1.025, copper fell 0.5% to $3.47 silver also declined as much to $27.55.
Crude fell over $1 in the session, after rising nearly 1.5% in the week as Iran sanctions go into effect.
Norway's govt seems poised to intervene in its strike, impacting offshore oil production. Corn futures saw over a 2% decline after steadily rising all week after the USDA warned that weather was impacting crops.

- In China markets banks were lower on concerns that the second cut to key 1-year benchmark rates in 30 days will start to cut into profits. ICBC and Bank of China have set their 1-year deposit rates at 3.25% vs 3.00% new target by PBoC. China Vice Premier Wang Qishan warned that China will have trouble reaching its 10% trade growth target this year. Japan Fin Min Azumi warned that the government may run out of funds by October if the bonds bill is not passed.


Speakers/Geopolitical/In the press

- (KR) South Korea Fin Min Bahk: Policies this year will focus on domestic growth; China cutting rates twice in 30-day period is unusual

- (JP) Bank of Japan (BoJ) newly appointed board members are unlikely to be formally completed by the Govt in time for the central bank's rate review next week - Japan press

- (CN) Citi analysts view last nights rate cut as more aggressive than expected, still expect 1 more cut to 1-year rates and 2 cuts in the RRR in 2012 - financial press

- (IT) Italy approves spending cuts of €4.5B in 2012 (vs. €4.2B originally targeted) and €10.5B in 2013 - financial press

- (NZ) New Zealand Fin Min English: Has been a moderate recovery over the last year; Fluctuations in tax collections reinforce the need to control costs


Equities

- DCM: Reports June subscribers increased 11.3K v 126.6K prior

- XTA.UK: There is speculation that Glencore could raise its offer to at least 3 shares/Xstrata share (current offer is 2.8 shares) - UK Press

- Bank of Communications, 3328.HK: Exec Hong: Joint central bank action is a sign of desperation, Chinese banks bear the burden of policy easing

- Samsung Electronics, 005930.KR: Reports prelim Q2 Op profit KRW6.7T v KRW6.7Te; Rev KRW47.0T v KRW50.0Te

- QAN.AU: CEO Joyce: There is no truth to rumors that Qantas could be a takeover target by a group that includes former managers - Australian press

- INFA: Reports Q2 prelim $0.27-0.28 v $0.37e, R$188-190M v $217M (guided $0.35-0.37, R$210-220M prior); Board approves $100M increase to stock repurchase program (2% of market cap); -26% after hours


Fixed Income/Commodities/Forex

- JGB: (JP) BoJ's Rinban debt purchase operation fails to meet target

- (JP) Japan gov't official: PM Noda informed the IMF Chief Lagard that JPY strength is one sided, not fundamental

- SLV: iShares Silver Trust ETF daily holdings fall to 9,681 tons from 9,685 tons (lowest since 9,669 on Jun 11th)

- USD/ARS: (AR) Argentina Central Bank suspends dollar purchases, no reason given