Mixed equity trading session in Asia

Asia Market Update: Mixed equity trading session in Asia; AU and JP Mfg PMIs slow; USD index rises.

General trend

- Nikkei 225 has traded generally flat [Banks and Automakers trade generally lower; Gainers include Marine Transportation cos.] ;Softbank Group is holding AGM.

- Shanghai Composite traded modestly higher during morning session (+0.5%) [Consumer Discretionary index rises]; China Chippacking Technology rises over 400% in trading debut.

- Hang Seng has been supported by gains in the TECH index; Automakers also outperform.

- S&P ASX 200 has lagged [Energy and Financial indices lag].

- Companies due to report during the NY morning include Winnebago.

Headlines/Economic data

Australia/New Zealand

- ASX 200 opened 0.0%.

- (AU) AUSTRALIA JUN PRELIMINARY PMI MANUFACTURING: 58.4 V 60.4 PRIOR (13TH MONTH OF EXPANSION).

- (AU) Australia May Prelim Merchandise Trade Balance (A$) 13.3B v 8.0B prior final, Exports M/M: 11% v 3% prior final, Imports M/M: +1% v -3% prior final.

- (NZ) New Zealand Debt Management: Will offer NZ$2.6B in bonds in July via 5 auctions.

- (AU) Reserve Bank of Australia (RBA): Excess cash at exchange settlement (ES) accounts at A$267.3B v A$271.8B prior.

- (AU) Reserve Bank of Australia (RBA) Assist Gov (Economic) Ellis: aim of policy settings is to support return to full employment and inflation consistent with target - speaking to Ai Group Business Lunch.

- (AU) Commonwealth Bank: Sees RBA increasing cash rate in Nov 2022; Sees OCR at 0.5% end 2022 up from 0.1% currently.

- (AU) Australia sells A$1.0B v A$1.0B indicated in 1.25% May 2032 bonds, avg yield 1.612% v 1.6838% prior, bid to cover 3.83x v 3.66x prior.

- WOW.AU Guides FY21 to record A$57M pretax net gain; Demerger costs with Endeavor to be inline A$45-50M.

Japan

- Nikkei 225 opened 0.0%.

- (JP) Bank of Japan (BOJ) Gov Kuroda: Spoke about domestic and overseas economies with PM Suga; Explained extension of coronavirus support program.

- (JP) JAPAN JAN PRELIMINARY PMI MANUFACTURING: 51.5 V 53.0 PRIOR (5TH STRAIGHT MONTH OF EXPANSION).

- (JP) Bank of Japan (BOJ) April Meeting Minutes: Economy likely to recover ahead, supported by increased external demand.

- 9984.JP CEO Son: Share buybacks are always an option, but requires balanced thinking, need to consider other uses of capital – AGM.

- (JP) Japan is considering tightening regulation on foreign companies that hold stakes in domestic firms with important technology in areas - Japan press.

Korea

- Kospi opened +0.1%.

- 010140.KR Shareholders approve 5 for 1 capital reduction, common and preferred share value to be cut from KRW5,000 to KRW1,000.

- (KR) South Korea Finance Min Hong: Extra budget likely to exceed KRW30T (v previously speculated KRW33-35T), targeting to fund extra budget without more deficit bonds.

China/Hong Kong

- Hang Seng opened +0.6%; Shanghai Composite opened %.

- (CN) China Securities Journal: Companies should be alert to CNY depreciation risk.

- 002024.CN Denies rumors of Alibaba acquiring 40% stake in Suning and Suning Logistics.

- (CN) China PBOC sets Yuan reference rate: 6.4621 v 6.4613 prior.

- (CN) China PBOC Open Market Operation (OMO): Injects CNY10B in 7-day reverse repos v CNY10B in 7-day reverse repos prior; Net CNY0B v Net inject CNY0B prior.

- (CN) China Shenzhen Yantian Port to resume ops on June 24th.

- (CN) China State Planner (NDRC): Sent teams to investigate commodity prices and supplies.

Other

- (SG) Singapore May CPI M/M: 0.8% v 0.4%e; Y/Y: 2.4% v 2.2%e (fastest annual pace in over 7 years).

North America

- (US) Weekly API Crude Oil Inventories: -7.2M v -8.5M prior.

- (US) Senator Cassidy: White House and Senators do not yet have a deal for pay for the infrastructure bill.

- (US) Fed Chair Powell: Fed will wait for actual inflation as the trigger for any rate increase; will not raise rates preemptively or in response to very strong employment (US session).

Europe

- (UK) Business Sec Kwarteng: Govt will take a cautious approach on collection of late taxes from businesses during pandemic, don't want tax payments to put companies under - press.

Levels as of 01:15ET

- Hang Seng +1.6%; Shanghai Composite +0.5%; Kospi +0.4%; Nikkei225 +0.0%; ASX 200 -0.5%.

- Equity Futures: S&P500 +0.1%; Nasdaq100 +0.2%, Dax +0.2%; FTSE100 +0.0%.

- EUR 1.1943-1.1918; JPY 110.86-110.63; AUD 0.7560-0.7538; NZD 0.7029-0.6996.

- Commodity Futures: Gold +0.2% at $1,781/oz; Crude Oil +0.5% at $73.19/brl; Copper +1.1% at $4.28/lb.