Precious metals rose as USD weakened

Asia Market Update: Asia opened mixed, Nikkei lags amid drop in USD/JPY; Nasdaq FUTs outperform after tech earnings (FB, GOOGL, AMZN, AAPL); China Jul PMI data was mixed; Precious metals rose as USD weakened.

 

General Trend:

- US politicians have yet to announce stimulus deal, negotiations continue

- Japanese equities decline amid the stronger Yen and earnings; Exporters and Insurers are among the decliners

- Softbank drops amid possible delay in stock buyback plan

- Japanese companies expected to report earnings today include Mizuho Financial, Daiwa Securities, Mazda Motor, Murata Manufacturing, KDDI Corp, Takeda, Japan Tobacco

- Shanghai Composite reverses over 1.1% gain during morning session; Declining sectors include banks and property

- Tencent rises in HK after US large-cap tech earnings, Apple suppliers also gain

- Decliners in Australia include Energy, Resource and Financial firms

- LG Chemical rises over 6% amid better than expected profits and outlook for EV battery unit

- US 30-year Treasury FUTs extend gains in Asia

- BoJ may issue bond purchase schedule for Aug after the Tokyo close

- HSBC is expected to report Q2/H1 earnings on Monday (Aug 3rd)

 

Headlines/Economic Data

Australia/New Zealand

- ASX 200 opened -0.3%

- (AU) Australia June Private Sector Credit M/M: -0.2% v -0.1%e; Y/Y: 2.9% v 3.0%e

- *(AU) AUSTRALIA Q2 PRODUCER PRICE INDEX (PPI) Q/Q: -0.4% V 0.2% PRIOR; Y/Y: -1.2% V 1.3% PRIOR

- (AU) Australia Treasurer Frydenberg: Regulations need to keep up with Google and Facebook; To release draft of mandatory code for social media platforms

- (NZ) New Zealand July ANZ Consumer Confidence: 104.3 v 104.5 prior

- (NZ) Reserve Bank of New Zealand (RBNZ): Will seek to purchase NZ$940M v NZ$940M prior in government bonds next week

China/Hong Kong

- Hang Seng opened +0.2%, Shanghai Composite -0.2%

- *(CN) CHINA JULY MANUFACTURING PMI (GOVT OFFICIAL): 51.1 V 50.8E (5th straight expansion); Non-Manufacturing PMI: 54.2 v 54.5e (6th straight month of expansion)

- (CN) China reported to set up bailout fund for state companies, aiming to raise CNY100B to help avoid bond defaults - China Press

- (CN) US Senate Committee passes bill allowing Americans to sue China over coronavirus – press

- (CN) China National Health Commission Coronavirus Update for July 30th: 127 additional cases v 105 prior; Additional deaths: 0 v 0 prior

- (CN) China Politburo reiterates stance to keep growth within a reasonable range; monetary policy to be more targeted - financial press

- (US) Dept of Transportation refuses to approve flights from China, citing China govt actions on restricting airlines

- (CN) China PBOC sets Yuan reference rate: 6.9848 v 6.9902 prior

- (CN) China PBoC Open Market Operation (OMO): Injects CNY20B in 7-day reverse repos v Injects CNY50B in 7-day reverse repos prior; Net injection CNY20B v Net injection CNY0B prior

Japan

- Nikkei 225 opened -0.3%

- *(JP) JAPAN JUNE PRELIMINARY INDUSTRIAL PRODUCTION M/M: +2.7% V 1.0%E; Y/Y: -17.7% V -19.3%E

- *(JP) JAPAN JUNE JOBLESS RATE: 2.8% V 3.1%E

- (JP) Japan Fin Min Aso: Yen has been rising 'rapidly' recently, Yen strength doesn't correlate with trade balance shifts; Shifts in Yen will not have immediate impact on Japan economy

- (JP) Japan Senior Finance Ministry (MOF) Official: Reiterates no comment on FX levels, watching FX markets with urgency, FX stability is important

- (JP) Tokyo reportedly finds >400 additional coronavirus cases - Press

- (JP) Tokyo Gov Koike: Tokyo confirms 463 additional coronavirus cases (record high); Tokyo must think of declaring emergency if situation worsens

- (JP) Japan Cabinet Office updates economic outlook: Forecasts FY20/21 GDP (current year) at -4.5% (in-line with speculation)

- (JP) Follow up: Bank of Japan (BOJ) appoints a new department head overseeing digital currencies - Financial Press

-*(JP) JAPAN JUN ANNUALIZED HOUSING STARTS: 790K V 815KE; Y/Y: -12.8% V -13.0%E

-*(JP) JAPAN JULY CONSUMER CONFIDENCE INDEX: 29.5 V 28.4 PRIOR

- (JP) Japan May Domestic Vehicle Production Y/Y: -61.1% v -46.1% prior

Korea

- Kospi opened +0.5%

- *(KR) SOUTH KOREA JUNE INDUSTRIAL PRODUCTION M/M: 7.2% V 2.3%E (fastest rise in over 11 years) ; Y/Y: -0.5% V -5.0%E

North America

- (US) Treasury Sec Mnuchin: We are going back to the negotiating table; Best case scenario, deal is done in next few days

- *(US) Q2 ADVANCE GDP ANNUALIZED Q/Q: -32.9% (record decline) V -34.5%E; PERSONAL CONSUMPTION: -34.6% V -34.5%E (from July 30th)

- (US) Pres Trump questions whether the election should be delayed until it can be done 'properly, securely and safely'

- (US) Sen Maj Leader McConnell (R-KY): Nov election date is set in stone

- (US) Texas daily coronavirus related deaths hit 322 (record) - US financial press

Europe

- (CN) China commission to EU: Opposed to unilateral cyber sanctions, says the two sides need more dialogue

 

Levels as of 1:20 ET

- Nikkei 225, -2.5%, ASX 200 -2% , Hang Seng +0.1%; Shanghai Composite flat ; Kospi -0.3%

- Equity S&P500 Futures: +0.1%; Nasdaq100 +0.7%,

- EUR 1.1905-1.1837 ; JPY 104.82-104.18 ; AUD 0.7225-0.7183 ;NZD 0.6707-0.6679

- Gold +1.1% at $1,962/oz; Crude Oil +0.6% at $40.13/brl; Copper +0.3% at $2,9270/lb