Weaker USD ahead of payrolls, calmer commodities and markets

Asia Market Update: Weaker USD ahead of payrolls; Calmer commodities and markets; US regional banking fears still in focus; ECB raises rates (as expected).

General trend

- After NAB disappointed yesterday, ANZ and Macquarie Group beat ests; both firms also hiked dividends.

- After yesterday’s gyrations, oil is back trading pretty much where it was a day ago before the severe down/up.

- US equity FUTs are slightly higher, particularly post-Apple’s higher than expected earnings (+ 2.5% AH).

- The concerns with regional banks in the US won’t go away, with fears of speculators hunting out weakness throughout the sector via short-selling.

- Corporate earnings still in focus for the week, while the final Asian holidays for golden are today with Japan, South Korea.

Headlines/economic data

Australia/New Zealand

- (AU) ASX 200 opens -0.2% at 7,178.

- Australia New Zealand Bank (ANZ.AU) Reports H1 (A$) Cash NPAT 3.82B v 3.11B y/y (3.81Be), NII 8.50B v 7.10B y/y, Rev 10.5B v 9.5B y/y.

- Macquarie Group (MQG.AU) Reports FY23 (A$) Net 5.18B v 4.71B y/y (4.99Be), Op Rev 19.1B v 17.3B y/y.

- (AU) Australia Mar Home Loans Value M/M: 4.9% v -0.3%e.

- (AU) AUSTRALIA CENTRAL BANK (RBA) STATEMENT ON MONETARY POLICY (SOMP): Reiterates some further policy tightening may be required; assuming a peak rate of 3.75%.

- (AU) Australia Treasurer Chalmers unveiled plan to deal with electricity prices; budget expected to include substantial relief for vulnerable Australians - Press [update].

China/Hong Kong

- (HK) Hang Seng opens +0.6% at 20,061.

- (CN) Shanghai Composite opens flat at 3,350.

- (HK) Hong Kong Mar Retail Sales Value Y/Y: 40.9% v 41.2%e; Retail Sales Volume Y/Y: 39.4% v 35.5%e.

- USD/CNY (CN) China PBOC sets Yuan reference rate: 6.9114 v 6.9054 prior.

- (CN) China PBOC Open Market Operation (OMO): Sells CNY3.0B v CNY33.0B prior in 7-day reverse repo: Net drains CNY162B v drains CNY529B prior.

- Apple (AAPL) CEO Cook: Supply chain had no material shortages at all during Q2 - post earnings comments.

- (CN) CHINA APR CAIXIN PMI SERVICES: 56.4 V 57.0E (4th straight expansion).

Japan

- (JP) Nikkei 225 closed for holiday.

- (JP) Japan PM Kishida: Reiterates stance of not planning on calling election at this time.

South Korea

- (KR) Kospi closed for holiday.

Other Asia

- (TW) US said to 'hint' Taiwan chip-related firms may receive support under the Chips Act - Taiwan media.

- (TW) Taiwan Central Bank (CBC) Mar Minutes – inflation expected to soften this year.

- (PH) Philippines Apr CPI Y/Y: 6.6% v 7.0%e (12th month above target).

- (PH) Philippines Central Bank (BSP): Remains committed to adjusting monetary policy stance as necessary to prevent further broadening of price pressures [follows Apr CPI data].

- (ID) Indonesia Q1 GDP Q/Q: -0.9% v -1.0%e; Y/Y: 5.0% v 5.0%e.

North America

- (US) Q1 PRELIMINARY NON-FARM PRODUCTIVITY: -2.7% V -2.0%E; UNIT LABOR COSTS: 6.3% V 5.5%E (biggest drop in productivity and biggest increase in unit labor costs since Q2 2022).

- (US) INITIAL JOBLESS CLAIMS: 242K V 240KE; CONTINUING CLAIMS: 1.81M V 1.87ME.

- (US) Fed releases factors affecting reserve balances (H.4.1): Discount window borrowing fell to $5.35B v $73.9B w/w; Banks have borrowed $75.8 v $81.3B w/w from new BTFP facility.

- (US) Federal and State officials said to be investigating potential market manipulation in banks - press.

- AAPL Reports Q2 $1.52 v $1.43e, Rev $94.8B v $93.1Be; Announces up to $90B share buyback; Raises Quarterly dividend 4.3% to $0.24 from $0.23 (indicated yield 0.57%).

Europe

- (EU) ECB RAISES KEY RATES BY 25BPS; AS EXPECTED; Rates will stay restrictive for as long as necessary.

- (EU) ECB chief Lagarde: Inflation is too high for too long; price pressures remain strong - Prepared remarks.

- (EU) ECB chief Lagarde: Mood on meeting was 'determined' to get inflation back to target; Do NOT have a numerical estimate for sufficiently restrictive - Q&A.

- (UK) MAR NET CONSUMER CREDIT: £1.6B V £1.2BE; NET LENDING: £0.0B V £1.6BE.

- (UK) MAR MORTGAGE APPROVALS: 52.0K V 46.0KE (5-month high).

Levels as of 01:20 ET

- ASX200 +0.4%; Hang Seng +0.7%; Shanghai Composite +0.7%; Nikkei 225 closed; Kospi closed.

- Equity S&P500 Futures +0.4%; Nasdaq100 +0.5%, DAX +0.3%; FTSE100 -1.1%.

- EUR 1.1008 - 1.1046 ; JPY 133.88 - 134.32 ; AUD 0.6692 - 0.6741 ; NZD 0.6277 - 0.6316.

- Gold flat at $2,056/oz; Crude Oil +0.9% at $69.14/brl; Copper +0.3% at $3.8688/lb.

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