Asian indices trade mixed

Asia Market Update: Asian indices trade mixed, Hang Seng and Shanghai lag after over 2% gains on Monday

General Trend:

- Kospi outperforms as chipmakers rise; Japan said to have approved additional exports of the high tech material photoresists to South Korea (press)

- BHP declines as earnings miss ests

- RBA Aug Minutes reiterate policy stance, commented on Q2 GDP and unconventional policies of other central banks

- Aussie rises amid the release of RBA minutes

- China PBOC fixed the 1-year loan prime rate (LPR) lower vs prior session, in line with market expectations; Little initial market reaction seen, some analysts expect the PBOC will lower the LPR gradually

- G7 Leaders Summit [Aug 25-26th in France] may end without joint communique for first time since the meetings started in 1975 (Japanese Press)

- Various press outlets focus on the theme of stimulus hopes

- South Korean airlines continue to revise Japan operations amid lingering dispute between Japan/South Korea

- The Foreign Ministers from Japan and South Korea are expected to meet in Beijing on Wed.

Headlines/Economic Data

Australia/New Zealand

- ASX 200 opened +0.1%

- (AU) RESERVE BANK OF AUSTRALIA (RBA) AUG MINUTES:REASONABLE TO EXPECT EXTENDED PERIOD OF LOW INTEREST RATES; WILL CONSIDER FURTHER EASING IF EVIDENCE SUGGESTS NEEDED

- BHP.AU Reports FY19 Underlying Net $9.12B v $9.9Be, Underlying EBITDA $23.2B v $24.1B y/y, Rev $45.1B v $44.7Be; affirms FY20 guidance; issues FY21 guidance

- BHP.AU Issues Commodity Outlook: Sees steel making raw materials prices above marginal cost

- (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence: 112.8 v 115.5 prior

- (AU) Australia Prudential Regulation Authority (APRA): Released strengthened prudential standard, aimed at mitigating contagion risk within banking groups

Japan

- Nikkei 225 opened +0.2%

- 6758.JP Sony Interactive Entertainment to acquire Insomniac Games, Developer Of PlayStation®4 Top-Selling Marvel's Spider-Man, Ratchet & Clank; terms not disclosed

- (JP) Japan G7 summit may end without communique due to trade issue, would be the first time that G7 Leaders Summit ended without joint communique since meetings started in 1975 - Japan Press

- (JP) Japan said to have approved additional exports of high tech material to South Korea – press

- (JP) Japan MoF sells ¥899B v ¥900B indicated in 0.30% (prior 0.40%) 20-year bonds; avg yield 0.11% v 0.2490% prior; bid to cover 3.81x v 4.89x prior

Korea

- Kospi opened +0.2%

- (KR) South Korea and US to wrap up week long military exercises today, as scheduled; will be looking to see if North Korea backs off its missile launches now

- 005380.KR Considering production cuts at plant in India - Korean press

- 003490.KR To suspend and reduce the number of flights to Japan, to increase flights to Danang, Bali and China

China/Hong Kong

-Hang Seng opened -0.1%; Shanghai Composite opened -0.1%

- (CN) CHINA PBOC SETS LOAN PRIME RATE (LPR) AT 4.25% V 4.31% PRIOR (4.24%e); SETS 5-YEAR LPR AT 4.85% (1ST SETTING SINCE ANNOUNCING LPR MECHANISM)

- (CN) China PBoC Deputy Gov Liu Guoqiang: New rate reform cannot replace monetary policy and other policies; will work with other government departments to lower funding costs focusing on small and private firms; Future interest rate policy will focus will be on the LPR

- (CN) PBoC Monetary Policy Dept Head Sun Guofeng: Will review loan prime rate pricing model; China will not scrap benchmark lending rate for the time being; There is room for cuts in both the RRR and lending rate, room to cut RRR is not as big as people thought

- (CN) China PBoC Open Market Operation (OMO): Injects CNY50B in 7-day reverse repos v Injects CNY20B prior; Net drain CNY10B v drain CNY10B prior

- (CN) China PBoC sets yuan reference rate: 7.0454 v 7.0365 prior

- (HK) Hong Kong Chief Exec Lam: HK police monitoring body to hire overseas experts; to start platform for dialog immediately

North America

- (US) State Attorney Generals to move ahead with antitrust investigation of big tech companies - US financial press

- (US) Fed’s Rosengren (hawk, dissenter): economic conditions are still pretty good, which led to my dissent for no rate cut - Bloomberg TV interview

- BIDU Reports Q2 $1.47 v $0.94e, Rev $3.84B v $3.77Be

- AAPL Said to commit more than $6.0B for new shows for streaming service, targeting launch of Apple+ video service by Nov at $9.99/month with a free trial – FT

- HGV Apollo Global said to be looking to acquire Hilton Grand Vacations at as much as $36/shr - NY Post

Europe

- (US) White House: President Trump spoke with UK PM Johnson Monday, he gave an update on Brexit

- (UK) UK PM Boris Johnson said to have told his trade ministers not to discuss the National Health Services (NHS) in any deal with the US - The Sun

Levels as of 1:20 ET

- Nikkei 225, +0.4%, ASX 200 +0.9%, Hang Seng flat; Shanghai Composite +0.1%; Kospi +1%

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

- EUR 1.1089-1.1077 ; JPY 106.69-106.51 ; AUD 0.6785-0.6754 ;NZD 0.6424-0.6402

- Gold -0.4% at $1,506/oz; Crude Oil -0.1% at $56.10/brl; Copper +0.1% at $2.601/lb