No fresh violence near Saudi or US military facilities nor in Hormuz
|Asia market update: Asia bounces back following US; No fresh violence near Saudi or US military facilities nor in Hormuz; CN NPC inline.
General trend and developments
- Kospi rebounded hard at the open, +11%, taking back nearly all of the record one-day losses yesterday, on a market that had been stretched to the max prior with non-stop gains week after week. [Note that even after the 13% losses yesterday that the Kospi was still +20% for 2026].
- Asia markets took heart from higher US equities, positive US data and a steadying energy complex. The VIX again >20 and US equity markets closing about or even above where they were last Fridays close. [On energy, Treas Sec Bessent said to expect additional details on US measures to get ships sailing through the Strait of Hormuz in the coming days and hours - though no details yet during Asia session.
- A Korean lawmaker noted the country only has 9 days of LNG reserves; While SK Hynix noted it had “enough” helium in storage.
- Corporate issuers use 'calm' in markets to launch debt offerings. [Five issuers raised~$17B in the primary market on Wednesday [NY session, with no fresh bond cancellations in Asia].
- China NPC affirmed earlier policy stances, while 2026 econ targets of 4.5-5.0% GDP and CPI 2.0% were in-line with expectations. Notably China to issue CNY300B in treasury bonds to support banks' capital. Little market moves seen the wake of the reports, though on a day when markets bounced back in any case so difficult to tease out cause and effects.
- Japan OIS BOJ chances of a hike reflected yesterday’s falling yield curve at the belly and front-end, with March back down to 4% (vs 8% day before), April down to 60% (vs 67.5% day before) and June at 86.5% (vs 91.5% day before).
- JP yield curve up 4-5bps in belly and long-end in a re-steepening. Asian yields in general were up after UST.
- Anthropic CEO said to be back in talks with the Pentagon about an AI deal - just a day or so after being banned from all US govt services by Treas Sec Bessent and Pres Trump.
- Major Japan union group, UA Zensen, seeking pay increase of ~6.5% in 2026 Spring Wage talks.
- US equity FUTs -0.2% during Asia trading.
Looking ahead (Asian-weighted focus, using Asian time zone)
-Thur Mar 5th (Thur night EU ECB Minutes, EU ECB Lagarde Speech).
- Fri Mar 6th EU GDP, (Fri Night US Jan Retail Sales, US Feb Nonfarm Payrolls).
Holidays in Asia this week
- Mon Mar 2nd South Korea.
-Tue Mar 3rd India, Thailand.
Headlines/economic data
Australia/New Zealand
- (AU) ASX 200 opens +0.5% at 8,945.
- (AU) Australia Jan Household Spending M/M: 0.3% v 0.4%e; Y/Y: 4.6% v 5.1%e.
- (AU) Australia Jan Trade Balance (A$): 2.6B v 3.8Be.
- (AU) Australia PM Albanese: Discussed with Canada PM Carney importance of clean energy transition, and defense cooperation, critical minerals.
- (NZ) New Zealand Feb Cotality Home Value M/M: +0.2% v -0.1% prior.
- (NZ) New Zealand Q4 Volume of All Buildings Q/Q: -3.1% v 1.9%e.
China/Hong Kong
- (CN) Shanghai Composite opens +0.7% at 4,109; (HK) Hang Seng opens +1.3% at 25,584.
- (CN) China National Peoples’ congress (NPC): Sets 2026 GDP Growth Target “4.5-5.0%” (v ~5.0% in 2025); Sets 2026 CPI target at “~2.0%" (v 2.0% in 2025).
- (CN) China MOF: To cotinue to issue sovereign green bonds.
- (CN) Govt urges companies to suspend or cancel March-loading fuel exports - Press.
- (HK) Hong Kong lawmaker has called for enhancing listing rules for technology firms - Press.
- (CN) China PBOC sets Yuan reference rate: 6.9007 v 6.9124 prior [strongest Yuan fix since late Apr 2023].
- (CN) China PBOC Open Market Operation (OMO): Injects CNY23B in 7-day Reverse Repos; Net drains CNY298B v drains CNY369B prior.
Japan
- (JP) Nikkei 225 opens +1.8% at 55,204.
- (JP) Japan sells¥ 700B vs. ¥700B in 30-year JGB bonds; Avg yield: 3.3980% v 3.6150% prior; Bid-to-cover: 3.66x v 3.64x prior
- (JP) Over 460 unions linked to UA Zensen said to be seeking pay increase of ~6.5% for regular workers in 2026 Spring Wage talks - press
- (JP) Japan raises travel warning level for UAE, Qatar and others - financial press
Korea
- (KR) Kospi opens +3.1% at 5,251
- (KR) South Korea NPS [pension service] to delegate voting to external managers – South Korea press.
- (KR) Reportedly US and South Korea will discuss redeployment of their United States Forces Korea (USFK) assets to the Middle East - press.
- (KR) According to South Korea lawmaker, the country has only 9 days of LNG reserves – US financial press.
- (KR) South Korea Pres Lee: Need to counter volatility increase in financial markets - financial press.
Other Asia
- (ID) Indonesia Chief Econ Min Hartarto: Will examine Fitch's warning (on Economic outlook).
- (PH) Philippines Feb CPI M/M: 0.2% v 0.3%e; Y/Y: 2.4% v 2.4%e.
- (PH) Philippines to deploy interventions if external shocks heighten - statement following CPI release.
- (PH) Central Bank: Will ensure that policy settings remain in line with its pursuit of price stability - financial press.
- (VN) Vietnam has implemented its fuel supply plan - Press.
- (TH) Thailand Feb CPI M/M: -0.2% v +0.2%e; Y/Y: -0.9% v -0.6%e.
- (TW) Econ Ministry: No worries about LNG supplies this month.
- (SG) MAS issues guidelines on environmental risk management; To take effect from Sept 2027.
- Nanya Tech sees DRAM supply to remain tight through 2028.
North America
- (US) Feb ISM Services Index: 56.1 V 53.5E; New Orders Index: 58.6 v 53.5e; Prices Paid: 63.0 v 68.3e (lowest reading in 11 months).
- (US) DOE Crude: +3.5M v +1.6Me; Gasoline: -1.70M v -1.0Me; Distillate: +0.4M v -2.8Me.
- (CA) Bank of Canada (BOC) Gov Macklem: Opacity of private credit means spike in defaults could cause severe strains, including spillovers into public credit markets; The risks 'have not disappeared; they've migrated'- (US) MBA Mortgage Applications w/e Feb 27th: 11,0% v 0.4% prior.
- (US) Sec of War Hegseth: US will take all the time it needs to ensure success; More forces are arriving; More waves are coming, US just getting started.
- (US) Feb Monthly ADP Employment Change: +63K V +50KE; Notes the best showing for job gains since July 2025; Data shows no widespread pay benefit from changing jobs.
- (US) Feb Final S&P PMI Services: 51.7 v 52.3e (confirms 7th month of expansion).
- (US) DOJ said to probe fertilizer market for potential price fixing - press.
- (US) Fed Beige Book: Overall economic activity increased at a slight to moderate pace in seven of the twelve federal reserve districts, while the number of districts reporting flat or declining activity increased from four to five.
- (US) Fed's Miran (dovish dissenter): Still see March rate cut appropriate, have not changed view due to Iran conflict; 100bps of cuts this year is my base case.
- (US) Montana GOP Senator Daines (R) will not run for reelection in surprise move – Washington Post.
- (CA) Canada Foreign Minister: Directed my official to enter into contracts for charter flights to repatriate Canadians from United Arab Emirates.
- (BR) Brazil Feb Services PMI: 53.1 v 51.3 prior (4th month of expansion).
- (VE) US Pres Trump reportedly sends Interior Sec to Venezuela to push oil and mining - press.
- (VE) Trump Admin said to broker 'multi-million' dollar US-Venezuela gold deal with state-owned mining company for up to 1K kg of gold for US markets - Axios.
Europe
- (EU) European Union reportedly expects to be exempt from Trump’s new global 15% tariff - financial press.
- (UK) UKMTO: Received a report of an incident 30 NM southeast of Mulbarak Al Kabeer [Kuwait].
- (FI) ECB's Rehn (Finland): Reiterates ECB's meeting-by-meeting approach.
- (IE) Ireland Feb Unemployment Rate: 4.6% v 4.6% prior.
- (PL) Poland Central Bank (NBP) cuts base rate by 25bps to 3.75%; As expected.
- (CZ) Czech Central Bank Prochazka: May cut rates to 3.25% this year - interview.
Middle East
- (QA) Qatar said to fully shut gas liquefaction today; Will need 2 weeks to restart - press.
- (IR) Iran semi-official Tasim: Deny NYT report that Intel Ministry reached out to CIA for talks to end war.
- (IR) Treasury Sec Bessent: Everything regarding Iran is going magnificently; Had months and weeks of planning regarding oil and energy; Contingency plans have been in place for months and we will be reaching out to ship owners in coming days.
- (IR) Reportedly Iran will target Israeli's nuclear site of Dimona if Israel and US scheme for regime change - press.
- (IR) US Senate votes 53-47 to block war powers resolution that would have prevented additional Iran strikes without Congressional approval.
- (IR) Iran: No leniency towards any separatist action.
- (IR) Energy Sec Wright: 'When the time is right' US Navy will escort ships through the Straits of Hormuz - financial press.
- (IR) Iran launches new missiles, drones at US, Israeli targets - FARS.
- (IQ) Reportedly Iraq's power grid has been completely shut down across all provinces - press.
- (QA) Qatar Interior Ministry: Authorities are evacuating residents living in the vicinity of the US Embassy as temporary precautionary measure.
Levels as of 00:20 ET
Nikkei 225 +2.2%; ASX 200 +0.4%; Hang Seng +1.0%; Shanghai Composite +1.0%; Kospi +11.1%.
Equity S&P500 Futures -0.1%; Nasdaq100 -0.2%; DAX +1.7% FTSE100 +0.8%.
EUR 1.1648-1.1606; JPY 157.19-156.45; AUD 0.7090-0.7047; NZD 0.5949-0.5926.
Gold +0.6% at $5,174/oz; BTC +6.6% at $72,778, Crude Oil +3.9% at $77.57/bbl; Copper -0.1% at $5.8963/lb.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.