Equity markets trade mixed, JPY rises on panel recommendation
|Asia market update: Equity markets trade mixed; JPY rises on panel recommendation; Key central bank decisions due this week [including US Fed].
General trend
- Shanghai Composite pares gain after extended holiday.
- Hang Seng extends decline.
- Nikkei 225 trades generally flat.
- Japanese cos. due to report earnings include Sumitomo Mitsui Financial, Oriental Land, Central Japan Railway, Canon Inc, Nomura Research, Shionogi, Omron, NEC Corp, Chubu Electric, Daiwa Securities, Capcom, Sekisui Chemical, Hitachi Transport Systems, Toei Animation, NGK Spark Plug.
- US equity FUTS decline.
- NZ companies react to floods in Auckland.
- US Natural Gas FUTs drop.
- BOJ’s Amamiya might speak in parliament.
- BOJ expected to release updated bond buying schedule.
[Reminder] Bank of Japan (BOJ) again offers 5-year loans to banks: will conduct Funds-Supplying Operations against Pooled Collateral on January 31.
Headlines/economic data
Australia/New Zealand
- ASX 200 opens -0.1% at 7,490.
- (AU) Australia sells A$300M v A$300M indicated in May 2041 bonds; Avg Yield: 3.9341%; bid-to-cover: 2.95x.
- (AU) S&P affirms Australia AAA sovereign rating; Outlook Stable.
- (NZ) New Zealand Dec Trade Balance (NZ$): -475M v -1.9B prior - update.
China/Hong Kong
- Hang Seng opens -0.5% at 22,579.
- Shanghai Composite opens +1.4% at 3,308 [returns from week-long holiday].
- (CN) Cities in China have room to cut mortgage rates further – Chinese Press.
- (CN) China PBOC extends green sector policy tools until the end of 2024 – US financial press.
- (CN) China PBOC sets Yuan reference rate: 6.7626 v 6.7702 prior.
- (CN) China PBOC Open Market Operation (OMO): Sells CNY173B in 7-day reverse repos v CNY62B prior; Sells CNY0B in 14-day reverse repos v CNY319B prior: Net injects CNY99.0B.
- (CN) China PBOC to limit impact from large reverse repo maturity following extended Lunar New Year holiday - Chinese press.
- (CN) China CDC: No significant COVID rebound in China during the Lunar New Year holidays.
- (CN) China Culture and Tourism Ministry: Lunar New Year China domestic tourism trips at 300M +23% y/y, -11.4% v 2019 levels.
Japan
- Nikkei 225 opens flat at 27,384.
- (JP) Japan Productivity Center Panel: Government and BOJ should make new joint statement.
- (JP) Bank of Japan (BOJ) announcement related to daily bond buying operation: inline with planned amounts.
- (JP) Bank of Japan (BOJ) offers to buy 5-10 year JGBs at fixed rate of 50bps; Opens window to buy unlimited amount of 10-year JGBs at 0.50% [as expected].
- (JP) Bank of Japan (BOJ) Gov Kuroda: Central Bank's biggest responsibility is price stability.
- (JP) Japan Chief Cabinet Sec Matsuno: To maintain China border controls for the time being; declines comment on why China may have resumed issuing visas for Japan citizens.
Korea
- Kospi opens flat at 2,484.
- (KR) South Korea sells 5-year bonds: Avg Yield: 3.25%.
Other Asia
- (IN) Adani Group CFO said confident secondary share sale will 'sail through' - financial press.
North America
- (US) House Speaker McCarthy says Republicans will not allow the US to default on its debt; US President Biden to host McCarthy at the White House on Feb 1st [Wed] – US media.
Europe
- (IR) Explosion reported at military plant in Isfahan in central Iran; Officials say it was an "unsuccessful" drone attack; No casualties reported – press.
- (UK) PM Sunak fires Conservative Party chair Zahawi after investigation into Zahawi's tax affairs found a serious breach of the ministerial code.
- (UK) Reportedly UK Fin Min provided PM Sunak an economic assessment this week that said it will be difficult to get inflation below 5% this year - press.
Levels as of 00:20 ET
- Nikkei 225, -0.1%, ASX 200 -0.2% , Hang Seng -2.2%; Shanghai Composite +0.3% ; Kospi -1.4%.
- Equity S&P500 Futures: -0.4%; Nasdaq100 -0.5%, Dax -0.3%; FTSE100 -0.3%.
- EUR 1.0879-1.0860 ; JPY 130.29-129.20 ; AUD 0.7120-0.7083 ;NZD 0.6506-0.6478.
- Gold +0.1% at $1,931/oz; Crude Oil -0.5% at $79.31/brl; Copper -0.6% at $4.2090/lbweek [including US Fed].
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