Asian Market Update: Asian markets higher following strong US performance; US unemployment lowest in 6 year
***Notable Economic Data*** - (HK) HONG KONG JUN HSBC PMI: 50.1 V 49.1 PRIOR - (PH) PHILIPPINES JUN CPI M/M: 0.4% V 0.7%E; Y/Y: 4.4% V 4.6%E; CORE CPI Y/Y: 2.8% V 3.1%E
***Index Snapshot (as of 02:30 GMT): - Nikkei225 +0.7%, S&P/ASX +0.6%, Kospi +0.1%, Shanghai Composite -0.3%, Hang Seng +0.1%, Jun S&P500 -0.1% at 1,976
***Commodities/Fixed Income/Currencies*** Aug gold flat at $1,320, Aug crude oil -0.2% at $103.88/brl - USD/CNY: (CN) PBoC sets yuan mid-point at 6.1642 v 6.1581 prior setting (weakest Yuan setting since Jun 4th) - (JP) BoJ offers to buy ¥110B in 1-yr and under JGB, ¥400B in 5-10yr JGB - (AU) Australia MoF (AOFM) sells A$600M in 4.25% 2026 Bonds; avg yield: 3.7224%; bid-to-cover: 3.73x
***Market Focal Points/Key Themes*** - Tracking the record setting gains in the US markets and the solid gains in the jobs data. The Asian bourses were mostly trading higher led by the Nikkei225 rising to a five month high. By the end of the morning session the Nikkei index was up 0.6% to 15,440.60 after rising to a high of 15,490. The USD held steady in the lower 102 range against the yen in early trading holding on to gains from the prior session.
- US crude continued to move lower for the sixth consecutive day, at a three-week low due to easing supply concerns following reports indicating increased crude shipments from Libya with Iraq exports likely to continue unabated. The Libya National Oil Company confirmed plans to lift force majeure on oil ports and planned to discuss with OPEC how to accommodate rising crude production.
- In the Vienna nuclear talks, Iran was said to have ease its nuclear capacity demands by reducing the number of centrifuges it is seeking. Though no figure was specified, western powers want Iran to reduce the number of centrifuges from the current 19.0k+ to the low thousands. The current round of discussion will run until at least July 15.
***Equities*** US markets: - LONG: Ctrip.com said to plan to purchase Expedia's stake in ELong; Deal said to value at $800M-$1B - financial press - CBAK: Subsidiary unit defaulted on about $85.9M in loans - filing
Notable movers by sector: - Consumer Discretionary: Imagi International Holdings 585.HK +6.5% (third party interested in stake) - Financials: Dai-Ichi Mutual Life Insurance 8750.JP -1.1% (confirms speculation on share sale); China Vanke 000002.CN +2.2% (Jun sales results); Steadfast Group SDF.AU +3.4% (announces acquisition) - Materials: Evolution Mining Ltd EVN.AU +5.5% (FY14 gold production results) - Energy: Oil Search Ltd OSH.AU +0.9% (provides drilling update); Drillsearch Energy DLS.AU +1.7% (analyst action); Yantai Jereh Oilfield Services Group 002353.CN +3.9% (share repurchase) - Industrials: Tianjin Port Development Holdings 600717.CN -1.9% (port under probe for petro-chemical financing) - Technology: High Tech Computer Corp 2498.TW +3.3% (Q2 results); Siliconware Precision Industries 2325.TW +1.4% (June Rev result)