RBA speak to continue

Asia Market Update: Equity markets trade mixed; Corporate earnings remain in focus; RBA speak to continue.

General trend

- RBA minutes commented on the neutral interest rate; RBA’s Bullock also spoke; AUD/USD trades higher.

- RBA Gov Lowe is due to give a speech on Jul 20th (Wed) [Inflation, Productivity and the Future of Money – at The Australian Strategic Business Forum].

- Japanese equity markets rise following holiday.

- China and HK markets decline after prior gains; Property indices drop.

- China and Japan cut holdings of US Treasuries to multi-year lows.

- Australia’s Consumer Discretionary index rises on results from JB-Hi-Fi.

- BHP pared rise, the co. issued production update and FY guidance.

- US equity FUTs rebounded during Asia.

- IBM declined after issuing results/guidance.

- PBOC is expected to leave the loan prime rates (LPRs) unchanged on Wed.

- Companies due to report during the NY morning include JNJ, Lockheed Martin, Haliburton, Hasbro, Mapnpower, Silvergate Capital.

Headlines/Economic data

Australia/New Zealand

- ASX 200 opened +0.1%.

- (AU) Reserve Bank of Australia (RBA) Dep Gov Bullock: Additional rate increases needed in months ahead; Risks important in timing and size of future interest rate hikes.

- BHP.AU Reports Q4 Waio Iron Ore Production: 71.7Mt v 72.8Mt y/y, Attributable Iron Ore Production: 64.2Mt v 65.2Mt y/y; Guides initial FY23 attributable iron ore production 249-260Mt, Waio iron ore production 278-290Mt.

- JBH.AU Reports Prelim FY22 (A$) Net 544.9M v 506.1M y/y; EBIT 794.6M v 743.1M y/y, Rev 9.23B v 8.92B y/y.

- (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence W/W: +0.2% v -2.5% prior.

- (AU) Reserve Bank of Australia (RBA) Jul minutes members considered possibilities of 25bps and 50bps increase, Current level of the cash rate is well below the lower range of estimates for the nominal neutral rate.

Japan

- Nikkei 225 opened +0.8%.

- (JP) Japan Fin Min Suzuki: Need careful discussion on international taxation; Making progress on a minimum corporate tax rate of 15%.

- 4568.JP U.S. Patent Office Issues Decision on Seagen’s Rehearing Request in Patent Dispute: co is disappointed with US patent office on Seagen.

- 9984.JP To pause plans of IPO for Arm in UK amid political instability - FT.

Korea

- Kospi opened -0.3%.

- (KR) South Korea President Yoon has asked the Land Min to making housing stability and welfare top priority – Yonhap.

- (KR) South Korea sells 20-year bonds: Avg yield 3.200% v 3.230% prior.

China/Hong Kong

- Hang Seng opened -0.6%; Shanghai Composite opened 0.0%.

- (CN) China Economic Daily: China 3.0% CPI target for 2022 is achievable.

- (HK) Hong Kong Monetary Authority (HKMA) purchases HK$8.1B to defend currency peg.

- (CN) Shanghai adds 14 medium risk areas to lockdown.

- (CN) China reports 237 new covid cases on mainland v 167 prior; Total cases ~700 (highest number of cases since May 22).

- (CN) China PBOC sets Yuan reference rate: 6.7451 v 6.7447 prior.

- (CN) China PBOC Open Market Operation (OMO): Sells CNY7.0B in 7-day reverse repos v CNY12B prior; Net inject CNY4.0B v Net CNY9.0B prior [first net injection since Jun 30th].

- (CN) China economy is facing pressure from the global economic slowdown and inflation - US financial Press.

Other

- (SG) Monetary Authority of Singapore (MAS) Managing Director: Rising interest from financial institutions reflects business resilience and increasing interest to access market opportunities in south and southeast Asia.

North America

- (US) MAY NET LONG-TERM TIC FLOWS: Japan Total Holdings of US Treasuries: $1.213T v $1.219T prior; China Total Holdings of US Treasuries: $981B (12-year low) v $1.003T prior.

- TWTR Musk reportedly plans to countersue Twitter in effort to cancel $44B acquisition - New York Post.

- IBM Reports Q2 $2.31 v $2.29e, Rev $15.5B v $15.1Be; Guides Q3 Rev 'growth in the high single digit range' (cc) - earnings call comments.

Europe

- (UK) Chancellor of the Exchequer (Fin Min) Zahawi: Aims to repeal hundreds of EU financial regulations and replace them with a UK version - pre-released remarks for Tues speech.

- (UK) UK increases investment into Northern Rail to £9.0B from £3.0B - press.

- (EU) EU Said to consider reschedule deliveries of certain coronavirus deliveries until 2024 from Pfizer and BioNTech citing oversupply and increasing case numbers - FT.

Levels as of 01:15ET

- Hang Seng -1.1%; Shanghai Composite -0.3%; Kospi -0.3%; Nikkei225 +0.7%; ASX 200 -0.7%.

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

- EUR 1.0149-1.0120; JPY 138.40-137.95; AUD 0.6848-0.6803; NZD 0.6180-0.6141.

- Commodity Futures: Gold -0.2% at $1,706/oz; Crude Oil -0.5% at $98.97/brl; Copper -0.8% at $3.29/lb.