Equity indices trade mixed amid the impact of holidays and corporate earnings

Asia Market Update: Equity indices trade mixed amid the impact of holidays and corporate earnings; Meta Platforms weighs on Nasdaq FUTs; European rate decisions in focus (BOE, ECB).

General trend

- South Korea and Singapore equities rise following holidays.

- Nikkei 225 has declined by over 1% amid focus on earnings and recent Yen strength [Fast Retailing (largest index component) dropped after issuing sales figures]; Topix Electric Appliances index dropped after earnings reports [Sony, Panasonic, Iriso] ]; Marine Transportation index has dropped [Nippon Yusen and Kawasaki Kisen reported results]; Banks index drops after megabank earnings.

- Japanese cos. due to report earnings include Nintendo, Nippon Steel, Takeda, Itochu, Mitsui & Co, Softbank Corp, Kao Corp, Nikon.

- S&P ASX 200 has traded slightly lower [Energy and Consumer Discretionary indices drop]; Financials rise amid results from Westpac; Resources index rebounds.

- China holiday in focus: Shanghai to close between Jan 31st and Feb 4th; HK to close Feb 1-3rd.

- RBA Quarterly Statement on Monetary Policy (SOMP) due on Fri (Feb 4th).

- Companies due to report during the NY morning include Arrow Electronics, BCE, Becton Dickinson, Berry Global, Biogen, Cardinal Health, Carlyle Group, Check Point Software, Cigna, Cummins, Conoco Phillips, Quest Diagnostics, Este Lauder, W.W. Grainger, Hain Celestial, Hanesbrands, Honeywell, Hershey, Intercontinental Exchange, Ingredion, Illinois Tool Works, Lazard, Eli Lilly, MasterCraft, Maximus, Merck, Madison Square Garden Sports, New Jersey Resources, Penn National Gaming, Parker-Hannifin, Ralph Lauren, Timken, Tradeweb, Viasat.

Headlines/Economic data

Australia/New Zealand

- ASX 200 opened 0.0%.

- (AU) AUSTRALIA DEC BUILDING APPROVALS M/M: +8.2% V -1.0%E.

- WBC.AU Reports Q1 (A$) Cash earnings 1.58B v 2.18B y/y; Rev 5.11B v 5.16B y/y; restructures business.

- (AU) Australia Jan Final PMI Services: 46.6 v 45.0 prelim (confirms 1st contraction in 4 months).

- (NZ) New Zealand PM Ardern presents 5 step plan to re-open borders, starting Feb 27th.

- (AU) Australia 2021 wine exports A$2.03B, -30% y/y; Exports ex-China +7% in value, -6% in volume - Wine Australia data.

- (NZ) New Zealand Fin Min Robertson: Labor market to remain competitive.

- (AU) Australia Q4 NAB Business Confidence: +18 v -2 prior.

Japan

- Nikkei 225 opened -0.7%.

- (JP) Bank of Japan (BOJ) Dep Gov Wakatabe: Tightening policy prior to hitting goals is premature; monetary policy is for one's own economy.

- (JP) Follow Up: Bank of Japan (BOJ) Dep Gov Wakatabe: Don't see any problem with recent moves in 10-year jgb yields as they are moving within 50bps range set around 0% target; rate cut is possible if downside risks intensify.

- (JP) Japan Jan Final PMI Services: 47.6 v 46.6 prelim (confirms 1st contraction in 4 months)

- 8318.JP Tokyo prosecutors investigating for market manipulation, said to have used timed buy orders to manipulate stock price – Nikkei.

- (JP) Japan MoF sells ¥900B v ¥900B indicated in 0.7% 30-year JGBs, Avg Yield: 0.7880% v 0.7190% prior, bid-to-cover: 3.45x v 3.63x prior.

- 8001.JP Reports 9M Net ¥678.9B v ¥364.3B y/y, Op ¥464.7B v ¥305.0B y/y, Rev ¥9.09T v ¥7.59T y/y; Raises FY guidance.

Korea

- Kospi opened +1.6%.

- 012450.KR Awarded KRW2.0T defense contract from Egypt military for Howitzers and ammo vehicles.

- (KR) South Korea Vice Fin Min Lee: To closely watch markets and will take steps if needed.

- (KR) South Korea reports record covid cases at 22.9K, 85.7% of population is now fully vaccinated.

- (KR) South Korea Fin Min Hong: Housing prices are expected to pick up their declining pace amid the central bank's rate hike and tighter lending rules.

- (KR) South Korea Jan PMI Manufacturing: 52.8 v 51.9 prior (16th consecutive expansion, highest since July 2021).

- (KR) Bank of Korea (BOK) Gov Lee: During the Lunar New Year holiday, international financial markets appear to have remained stable as a whole, but we should not let our guard down and keep close tabs on developments of global risks and their possible impacts on local financial markets and economy - post New year meeting.

- 042660.KR Awarded KRW525B and KRW1.32T contracts.

China/Hong Kong

- Hang Seng and Shanghai Composite closed for holiday.

- 700.HK SCMP notes that there is a growing market for "older singles" who are starting to use online dating, as attitudes shift about remarriage.

Other

- (IN) Said that India govt may cut gross market borrowing by up to INR600B during FY22/23 – press.

North America

- FB Reports Q4 $3.67 v $3.79e, Rev $33.7B v $33.2Be; Cites macro headwinds for soft Q1 outlook - anticipate modestly increasing ad targeting and measurement headwinds (-20% after hours).

- SLCA To raise prices by up to 15% on industrial and specialty products.

- COST Reports Jan total SSS +10.8% (ex-gas and FX).

- MCK Reports Q3 $6.15 v $5.38e, Rev $68.6B v $66.5Be; Raises guidance.

Europe

- Ireland Jan PMI Services: 56.2 v 55.4 prior (11th consecutive expansion).

- Northern Ireland Ag Min: Has issued order to halt Irish Sea border checks due to legal advice.

Levels as of 00:15ET

- Hang Seng closed; Shanghai Composite closed; Kospi +2.1%; Nikkei225 -1.1%; ASX 200 -0.2%.

- Equity Futures: S&P500 -0.9%; Nasdaq100 -2.2%, Dax +0.1%; FTSE100 -0.1%.

- EUR 1.1308-1.1293; JPY 114.54-114.33; AUD 0.7139-0.7116; NZD 0.6644-0.6610.

- Commodity Futures: Gold -0.2% at $1,807/oz; Crude Oil -0.4% at $87.92/brl; Copper -0.0% at $4.48/lb.