Mixed Asian equities in quiet trading as Nikkei falters on strongest Yen since Dec 2023

Asia market update: Mixed Asian equities in quiet trading as Nikkei falters on strongest Yen since Dec 2023; CN 'data dump' this week.

General trend

- Asian equities were mixed, but the Nikkei then fell 1.0% on the yen rising back to its Dec 2023 high. Pared losses to be only 0.4% down at time of writing on Yen coming back off its highest levels.

- Overnight Euro +0.6% after the ECB rate cut, as expected.

- Japanese chipmakers followed Nvidia's 2% rise in the US session by eking out another ~1% gain on top of yesterday's 8% rise, but no such luck in South Korea with Hynix -4% and Samsung Electronics -3%.

- Gold FUTs in Asia powered to another record high, as high as $2,597/oz.

- WTI oil kept ticking up back towards $70 handle, despite energy companies in the Gulf of Mexico reporting little or no damage to facilities from Hurricane Francine.

- New Zealand August Manufacturing PMI logged a record 18th month of contraction.

- Reminder on upcoming Chinese market holidays: Sat Sept 14th to Tue Sept 17th; Sept 29th (Sun); Tue Oct 1st to Mon Oct 7th; Sat Oct 12th.

- US equity FUTs +0.1% during the Asia session.

Looking ahead (Asian time zone)

- Sat Sept 14th China Aug ‘data dump’ (Ind. Production, Retail Sales, etc.).

Holidays in Asia this week

- N/A.

Headlines/economic data

Australia/New Zealand

- ASX 200 opens +0.1% at 8,087.

- Australia Comms Min responding to Elon Musk comments: Companies operating in Australia needs to comply with Australian laws.

- New Zealand Aug Manufacturing PMI: 45.8 v 44.0 prior (18th month of contraction).

- New Zealand Aug REINZ House Sales Y/Y: -0.7% v +14.5% prior.

China/Hong Kong

- Hang Seng opens +0.3% at 17,298; Shanghai Composite opens +0.1% at 2,718.

- Chinese EV makers lose EU appeal to avoid heavy tariffs – FT.

- China sells 7-year Bonds; Avg Yield: 1.8700% v 1.9691% prior.

- China Pres Xi: Need to strive to achieve 2024 growth and social development targets [overnight update].

- China Pres Xi to visit BRICS summit in Russia scheduled for Oct 22-24th – press [overnight update].

- China said to cut rates on $5T of mortgages as soon as Sept; Some banks are making final preparations for rate adjustments – press [overnight update].

- China MOFCOM's Wang set to meet EU's Dombrovskis to talk about EV tariffs – press [overnight update].

- China PBOC sets Yuan reference rate: 7.1030 v 7.1214 prior.

- China PBOC Open Market Operation (OMO): Sells CNY236B in 7-day reverse repos; Net injects CNY95B v net injects CNY98B prior.

Japan

- Nikkei 225 opens +0.1% at 36,882.

- USD hits lowest level against JPY since Dec 28, 2023.

- Exxon-Mobil signs project framework agreement with Mitsubishi Corp to advance world's largest low-carbon hydrogen project.

- Japan Fin Min Suzuki: Wage growth and consumption is key to end deflation - financial press.

- Japan sells ¥4.6T vs. ¥4.6T indicated in 3-Month Bills; Avg Yield: 0.0567% v 0.0778% prior; bid- to-cover: 3.13x v 4.20x prior.

South Korea

- Kospi opens flat at 2,571.

- South Korea July M2 Money Supply M/M: 0.4% v 0.6% prior.

- South Korea Aug Import Price Index M/M: -3.5% v 0.4% prior; Y/Y: 1.8% v 9.8% prior.

- South Korea FSC: Aim to end short-selling ban on all stocks in Mar 2025; All options on table to curb household debt [overnight update].

Other Asia

- Reserve Bank of India (RBI) Gov Das: Global growth remains steady, but subdued - financial press.

- Monetary Authority Singapore (MAS) Chief Chia: Expects y/y growth at strong end of 2-3% range; Sees Fiscal deficits in Seasia 'well contained'.

- INDIA AUG CPI Y/Y: 3.7% V 3.4%E.

- Hong Kong Q2 PPI Y/Y: 3.0% v 1.2% prior [overnight update].

- Hong Kong Q2 Industrial Production Y/Y: 0.7% v 1.8% prior [overnight update].

North America

- Boeing *MACHINISTS IN PACIFIC NORTHWEST TO GO ON STRIKE AFTER REJECTING LABOR DEAL.

- (US) Trump allies said to be considering privatizing Fannie Mae and Freddie Mac - WSJ, citing sources.

- (US) Former NY Fed Pres Dudley: Sees a case for 50bps cut in upcoming FOMC meeting.

- US) Former Pres Trump says he will end all taxes on overtime - US financial press.

- (BR) Brazil Fin Min Haddad: Reiterates 2024 GDP growth projected at 3.0%.

- (US) White House Economic Advisor Hochstein: Will continue to buy oil for SPR when price is right - CNBC interview.

- (PL) US State Sec Blinken: Discussed with Poland Foreign Min ways US can further support transition away from Russian energy.

- (US) AUG PPI FINAL DEMAND M/M: 0.2% V 0.1%E; Y/Y: 1.7% V 1.7%E; PPI (Ex Food and Energy) M/M: 0.3% v 0.2%e; Y/Y: 2.4% v 2.4%e.

- (US) Initial jobless claims: 230K V 227KE; continuing claims: 1.85M V 1.85ME.

- (US) Redfin: Mortgage-rate locks for second homes fell 13.1% y/y in August to the lowest level since March 2016 on a seasonally adjusted basis; Most of the homes that are sitting on the market right now are second homes.

- (US) U.S. Treasury: Announces new proposed rules for a new corporate alternative minimum tax; Would apply to companies with annual average adjusted financial statement income of $1B or more..

- (US) Weely EIA Natural Gas inventories: +40 BCF VS. +48 BCF to +50 BCF indicated range.

- (US) Treasury $22B 30-year bond eopening draws 4.015% V 4.405% prior; bid to cover 2.38 V 2.30 prio and 2.41 over last 8. reopening.

Europe

- ECB’s Nagel (Germany): On a good course to reach inflation target by the end of 2025.

- (RU) Russian Dep Defense Min: Russia has unique experience of fighting against various Western weapons, is ready to share it with partners - comments at China's Xiangshan defense industry forum in Beijing.

- (IE) Ireland Aug CPI M/M: 0.1% v 0.2% prior; Y/Y: 1.7% v 2.2% prior.

- (UK) BoE Dep Gov Woods (PRA Dir): Latest Basel package does not increase capital in system by 'much at all'.

- (PL) Poland Central Bank (NBP) Wnorowski: In the short term, there are no grounds for returning to cuts; Inflation could peak at the beginning of 2025 before slowing dow.

- (EU) ECB CUTS DEPOSIT RATE BY 25BPS TO 3.50%; AS EXPECTED; Narrows spread as expected; Reiterates data-dependent approach.

- (EU) ECB SEPT STAFF PROJECTIONS: Cuts GDP and raises core inflation forecasts.

- (EU) ECB Chief Lagarde: Appropriate to moderate the degree of monetary policy restriction further; inflation is expected to pick up in the latter part of 2024.

- (DE) German Chancellor Scholz: We're lobbying EU commission to ensure the electricity price compensation can relieve burden in other areas of economy.

- (LY) Libya political factions haven't reached final deal on central bank crisis - UN post on X.

- (EU) ECB Oct rate cut said to be unlikely for now; Would require exceptional negative growth surprises - press.

Levels as of 01:20 ET

- Nikkei 225 -0.6%; ASX 200 +0.3%; Hang Seng +0.9%; Shanghai Composite -0.1%; Kospi -0.2%.

- Equity S&P500 FUTs +0.1%; Nasdaq100 FUTs +0.1%, Dax +0.1%; FTSE100 -0.1%.

- EUR 1.1070-1.1091: JPY 140.65-141.88; AUD 0.6619-0.6633; NZD 0.6169-0.6194.

- Gold +0.7% at $2,597/oz; Crude Oil +0.7% at $69.44/brl; Copper +0.3% at $4.2252/lb.