Asia Market Update: Asian equities follow NY lead; FTC/DOJ open AI antitrust probe into NVDA, MSDT, OpenAI; JP bonds rise on falling USTs and well supported bond auctions; Eyes on ECB rate decision tonight.

General trend

- Japan chip-related Advantest +5%, mirroring the earlier US gains of Nvidia overnight, in what was a positive session for equities in Asia.

- However, a potential wrinkle for the US AI-driven boom, with US DOJ and FTC announcing antitrust investigations into various AI-related activities of Nvidia, Microsoft and OpenAI.

- Japan 10-year yields fell to a 2-week low of 0.97% (was up to 1.10% last week) after the well-supported 30-yr JGB auction today and falling UST yields earlier. USD/JPY range-traded around 155.30-155.75, with BOJ Ueda and Nakamura both speaking.

- Australia’s April trade balance came in slightly higher than estimates.

- New Zealand reported its total volume of building work in the March 2024 quarter (Q1) was the lowest quarterly volume in the past two years.

- US equity FUTs +0.1% during Asian trading, falling back towards overnight open levels after the FTC/DOJ announcement (at 23:42ET).

Looking ahead (Asian time zone)

- Thu Jun 6th (Thu night ECB rate decision + presser).

- Fri Jun 7th CN Balance of Trade, (Thu night DE May Balance of Trade, US NFP jobs, ECB Lagarde speech).

Holidays in Asia this week

- Monday June 3rd, Malaysia, New Zealand, Thailand.

- Thursday June 6th South Korea.

Headlines/economic data

Australia/New Zealand

- ASX 200 opens +0.1% at 7,778.

- Australia Apr Trade Balance (A$): 6.5B v 5.4Be.

- Australia Apr Home Loans Value M/M: 4.8% v 1.5%e.

- New Zealand Q1 Volume of All Buildings Q/Q: -4.0% v -0.5%e.

- New Zealand May ANZ Commodity Price M/M: 1.1% v 0.5% prior.

- New Zealand May CoreLogic House Prices M/M: -0.2% v -0.1% prior.

- Follow up on Australian bird flu: H7 bird flu detected on a fourth poultry farm in Victoria, Australia - Victoria State Govt.

- New Zealand Asst Energy Min Jones: MBIE to halt work on Govt procuring diesel stocks for reserves - New Zealand press.

- New Zealand prices NZ$3.5B May 2028 bond syndicate tap: Yield: 4.62%.

China/Hong Kong

- Hang Seng opens +0.5% at 18,577; Shanghai Composite opens +0.1% at 3,069.

- Reportedly US Congress members are pushing for a probe on Chinese solar companies - press.

- China May Retail Passenger Vehicle Sales -3.0% y/y v -5.3% y/y prelim - PCA.

- Reportedly Shanghai and Shenzhen stock exchanges are considering suspending certain value-added market data feeds to institutions such as computer-driven quant funds – press.

- China Pres Xi calls for more US-China education exchanges - China state media.

- China PBOC sets Yuan reference rate: 7.1108 v 7.1097 prior.

- China PBOC Open Market Operation (OMO): Sells CNY2B in 7-day reverse repos; Net drains CNY258B v net drains CN248B prior.

Japan

- Nikkei 225 opens +0.9% at 38,841.

- Japan May Tokyo Avg Office Vacancies: 5.5% v 5.4% prior.

- Japan BOJ Gov Ueda: Price expectations must be around the 2% target; Currently still below target - Parliamentary testimony.

- Bank of Japan (BOJ) Board Nakamura: Based on current data it is appropriate to keep policy intact for time being; Reiterates Japanese economy is recovering moderately albeit some weak signs.

- Japan releases weekly flows data [period ended May 31st]: Foreign buying of Japan equities: ¥282.0B v ¥82.4B prior; Japan buying of foreign bonds: +¥1.3T v -¥310.4B prior.

- JAPAN SELLS ¥900B VS. ¥900B INDICATED IN 30-YEAR JGB BONDS; AVG YIELD: 2.1560% V 1.9922% PRIOR, BID-TO-COVER: 3.59X V 3.25X PRIOR.

- Japan sells ¥3.7T vs. ¥3.7T indicated in 6-Month Bills; Avg Yield: 0.0858% v 0.0789% prior, bid-to-cover: 4.22x v 3.24x prior.

South Korea

- Kospi closed for holiday.

Other Asia

- (VN) S&P: The effects of a Vietnam bank failure 'will reach far'.

- US Commerce Sec Raimondo: Coalition [Global Infrastructure Partners, KKR and Indo-Pacific Partners] to invest $25B in Indo-Pacific countries.

- Taiwan Central Bank (CBC) Gov Yang: Inflation gradually coming down, while house prices are still high - press.

- (TW) US State Dept: Approves possible sale of F-16 parts to Taiwan for $80M - US financial press.

North America

- US) Federal regulators incl. FTC and DOJ clear way for antitrust inquiries into Nvidia, Microsoft and OpenAI - NY Times.

- (US) MBA Mortgage Applications w/e May 31st: -5.2% v -5.7% prior.

- (US) MAY ADP EMPLOYMENT CHANGE: +152K V +175KE (lowest since Jan); Cites "notable pockets of weakness tied to both producers and consumers"; Says job gains and pay growth are slowing going into H2 2024.

- (CA) Canada May Services PMI: 51.1 v 49.3 prior (1st expansion in 14 months).

- (CA) BANK OF CANADA (BOC) CUTS INTEREST RATES BY 25BPS TO 4.75%; AS EXPECTED.

- (US) MAY ISM SERVICES INDEX 53.8 V 51.0E; PRICES PAID: 58.1 V 59.0E; New Orders Index: 54.1 v 52.2 prior.

- (US) DOE CRUDE: +1.2M V -1.5ME; GASOLINE: +2.1M V +1ME; DISTILLATE: +3.2M V +1.5ME.

Europe

- (RU) Russian Pres Putin says Russia may send missiles closer to the West - US financial press via foreign news press conference with Pres Putin.

- (IE) Ireland May PMI Services: 55.0 v 53.3 prior (38th month of expansion).

- (EU) ECB reportedly reviews banks' lending to private equity industry - press.

- (DE) Germany May New Car Registrations 236.4K -4.3% y/y - KBA.

- (ZA) Initial ANC statement doesn't mention South African unity government - spokesperson.

- (EU) German Chancellor Scholz: Ready to create EU reinsurance system for national deposit protection schemes.

- (HU) Hungary Central Bank (MNB) May Minutes: Decision to cut Base Rate by 50bps was unanimous.

- (PL) POLAND CENTRAL BANK (MNB) LEAVES BASE RATE UNCHANGED AT 5.75%; AS EXPECTED.

Levels as of 01:20 ET

- Nikkei 225 +0.9%; ASX 200 +0.8%; Hang Seng +0.2%; Shanghai Composite -0.1%; Kospi closed.

- Equity S&P500 Futures +0.1%; Nasdaq100 +0.1%; Dax% flat; FTSE100 +0.2%.

- EUR 1.0869-1.0896; JPY 155.38-156.12; AUD 0.6647-0.6683; NZD 0.6185-0.6215.

- Gold +0.5% at $2,388/oz; Crude Oil +0.6% at $74.51; Copper +0.4% at $4.6760/lb.

All information provided by Trade The News (a product of Trade The News, Inc. "referred to as TTN hereafter") is for informational purposes only. Information provided is not meant as investment advice nor is it a recommendation to Buy or Sell securities. Although information is taken from sources deemed reliable, no guarantees or assurances can be made to the accuracy of any information provided. 1. Information can be inaccurate and/or incomplete 2. Information can be mistakenly re-released or be delayed, 3. Information may be incorrect, misread, misinterpreted or misunderstood 4. Human error is a business risk you are willing to assume 5. Technology can crash or be interrupted without notice 6. Trading decisions are the responsibility of traders, not those providing additional information. Trade The News is not liable (financial and/or non-financial) for any losses that may arise from any information provided by TTN. Trading securities involves a high degree of risk, and financial losses can and do occur on a regular basis and are part of the risk of trading and investing.

Recommended Content


Recommended Content

Editors’ Picks

Australian Dollar holds gains ahead of Michigan Consumer Sentiment Index

Australian Dollar holds gains ahead of Michigan Consumer Sentiment Index

The Australian Dollar recovers its losses as soft US inflation data raises expectations of Fed reducing rates. China's Trade Balance for June came in at $99.05 billion, widening from the previous figure of $82.62 billion. Fed’s Goolsbee stated that the US economy appears to be on track to achieve 2% target inflation.

AUD/USD News

EUR/USD: The door appears open to extra gains in the near term

EUR/USD: The door appears open to extra gains in the near term

Another auspicious week saw EUR/USD trade with decent gains and extend its positive streak for the third consecutive week, including a visit to the key 1.0900 region for the first time since early June.

EUR/USD News

Gold turns bullish as US data bolster case for Fed rate cut in September

Gold turns bullish as US data bolster case for Fed rate cut in September

Gold gathered bullish momentum and climbed above $2,400 on broad-based USD weakness. Investors expect the Fed to reduce the policy rate in September after soft inflation data. XAU/USD could target a new all-time high once $2,400 is confirmed as support.

Gold News

Shiba Inu erases losses from past week, eyes 18% gains

Shiba Inu erases losses from past week, eyes 18% gains

Shiba Inu traders are anticipating the roll-out of futures contracts, products like Exchange Traded Funds that could boost the asset’s utility. An IBC report shows the contract is expected to be listed post Monday, July 15.

Read more

Trump Assassination Attempt: Gold, stocks set to decline on Republican sweep speculation Premium

Trump Assassination Attempt: Gold, stocks set to decline on Republican sweep speculation

Fist in the air and on with the fight - that has been the historic picture that former President Donald Trump shortly after he survived an assassination attempt on his life. Trump was injured in his ear but seems to have come out stronger politically from the shocking political violence. 

Read more

Majors

Cryptocurrencies

Signatures