Asian Mid-session Market Update: Equities pushing to close May out on a strong note, while Aussie and Japan data show improvement
***Economic Data***
- (JP) JAPAN APR JOBLESS RATE: 3.2% V 3.2%E; Job-To-Applicant Ratio: 1.34 v 1.30e
- (NZ) NEW ZEALAND APR BUILDING PERMITS M/M: +6.6% V -9.8% PRIOR
- (KR) SOUTH KOREA APR INDUSTRIAL PRODUCTION M/M: -1.3% V -0.3%E; Y/Y: -2.8% V -1.3%E
- (KR) SOUTH KOREA APR CYCLICAL LEADING INDEX: 0.2 V 0.2 PRIOR
- (UK) MAY LLOYDS BUSINESS BAROMETER: 32 V 38 PRIOR
- (JP) JAPAN APR OVERALL HOUSEHOLD SPENDING Y/Y: -0.4% V -1.3%E
- (JP) JAPAN APR PRELIM INDUSTRIAL PRODUCTION M/M: +0.3% V -1.5%E; Y/Y: -3.5% V -5.0%E
- (AU) AUSTRALIA APR BUILDING APPROVALS M/M: +3.0% V -3.0%E; Y/Y: +0.7% V -6.7%E
- (AU) AUSTRALIA Q1 CURRENT ACCOUNT BALANCE (A$): -20.8B V -19.6BE; NET EXPORTS OF GDP: 1.10% V 0.7%E
- (AU) AUSTRALIA APR PRIVATE SECTOR CREDIT M/M: 0.5% V 0.5%E; Y/Y: 6.7% V 6.5%E
- (SG) Singapore Apr Credit Card Bad Debts (SGD): 27.5M v 29.6M prior; Credit Card Billings: 3.9B v 4.1B prior
- (SG) Singapore Money Supply M1 y/y: +0.7% v -1.8% prior; M2 y/y: 2.7% v 2.1% prior
- (SG) SINGAPORE APR BANK LENDING: S$589.8B V S$590.6B PRIOR
- (TH) THAILAND APR INDUSTRIAL PRODUCTION Y/Y: 1.5% V 1.0%E
- (KR) South Korea Apr Retail Sales m/m: -0.5% v 1.0%e; y/y: 4.2% (3-month high) v 2.9%e
- (JP) Japan Apr Vehicle Production Y/Y: -9.7% v +1.3% prior
- (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence Index: 113.2 v 115.7 prior
- (NZ) New Zealand Apr M3 Money Supply y/y: 7.8% v 7.8% prior
- (MX) Mexico Apr YTD Budget Balance: 117.1B v -61.6B prior
- (BR) Brazil May CNI Consumer Confidence: 105.2 v 97.5 prior
- (BR) Brazil Apr Central Govt Budget Balance (BRL): 9.8B v 2.9Be
***Index Snapshot (as of 04:30 GMT)***
- Nikkei225 +0.8%, S&P/ASX -0.1%, Kospi +0.7%, Shanghai Composite 2.4%, Hang Seng 1.2%
***Commodities/Fixed Income***
- Aug gold -0.2% at $1,212/oz, July crude oil +0.5% at $49.57/brl, Jul copper -0.4% at $2.11/lb
- (CN) PBOC SETS YUAN MID POINT AT 6.5790 V 6.5784 PRIOR; Weakest Yuan fix since Feb 2011
- (CN) PBOC to inject CNY120B in 7-day reverse repos
- (ID) Bank of Indonesia: IDR currency (Rupiah) is slightly deviating from fundamentals
- (AU) Australia MoF (AOFM) sells A$1.0B in 4.75% 2027 bonds; avg yield 2.3506%; bid-to-cover 2.05x
- JGB: Japan's MoF sells ¥2.09T v ¥2.3T offered in 0.1% (0.1% prior) 2-yr JGBs; avg yield -0.237%; bid-to-cover 5.52x
***Market Focal Points/FX***
- Asian equity markets push higher at mid-day after a subdued opening as stronger data and sentiment lend support to the region. Japan data was a bit stronger with household spending and industrial production coming in ahead of expectations while unemployment was inline. USD/JPY tested 110.79 on the date before finding support a little above 111. Markets continue to expect Japan to delay its sales tax hike until 2019, Japan Fin Min Aso said that the government and ruling parties are currently talking about sales tax and reiterated that PM Abe will make decision on sales tax when the time is right. Japan Opposition has submitted a no-confidence motion against PM Abe, though it is not expected to get anywhere.
- AUD/USD got a boost to 0.7250 with current account data showing that net export of GDP will be a positive 1.1% to Wednesday's release of Q1 GDP. Building approvals also showed a large improvement. Virgin Australia announced China's HNA was taking a 13% stake through a strategic agreement, which will reduce Singapore Air's stake to 20.1%. NZD/USD had about a 40pip range from 0.6732/0.6689, building permits saw a nice jump m/m after a prior decline.
- China markets remained strong into their break with the PBoC setting a weaker setting on the yuan. China officials reiterated their push towards open policy and reforms for currency. Hong Kong is looking into a better IPO review system in order to grow their pipeline.
***Equities***
US equities / ADRs: US markets closed for holiday
CPXX: Jazz Pharmaceuticals said to be close to a deal to acquire Celator for $1.5B - financial press
Notable movers by sector:
- Consumer discretionary: Hainan Airlines Co 600221.CN +1.9% (deal with Virgin Australia)
- Financials: FlexiGroup FXL.AU -7.9% (earnings update); Japan Post Insurance Co 7181.JP +2.4% (considers raising fees)
- Industrials: Toyota Motor Corp7203.JP ,'TM' +2.6% (Apr auto production); Virgin Australia VAH.AU +5.4% (enters into alliance with HNA); Takata Corp 7312.JP +2.7% (rules out bankruptcy); Bridgestone Corp 5108.JP +1.6%(agreement to purchase Speedy France); China Cosco Holdings Co 1919.HK +0.75% (update on restructuring)
- Technology: MediaTek Inc 2454.TW 1.4% (Q2 sales guide)
- Materials: Aluminum Corporation of China 2600.HK -1.3% (asset sales); Samsung C&T Corp 028260.KR -0.4% (to appeal court ruling)
- Energy: Nearmap Ltd, NEA.AU +10.2% (contract award)