Asian stocks were on the back foot as China’s sluggish economic recovery triggered growth forecast cuts and a warning from US Treasury Secretary Janet Yellen that it could cause ripple effects across the global economy. Stocks in mainland China and Hong Kong were down 0.3% and 2%, respectively, on Tuesday. They were little changed following the announcement of several measures by the government to prop up household consumption, including encouraging financial institutions to provide reasonable loan rates. Property developers were among the biggest losers on renewed concerns in the sector after China Evergrande Group reported hefty combined losses over two years. Adding to the negative sentiment was a warning of a funding shortfall by a key unit of Dalian Wanda Group. Benchmark indexes also slipped in South Korea and Australia, while Japanese equities remained narrowly in the green, partially supported by gains in electric vehicle supply chain firms after Tesla Inc.’s shares advanced and BYD Co. reported a threefold increase in first-half net profit. Contracts for US stocks extended their losses on news that US banks will face stiffer mortgage capital rules than set by the global standard. The S&P 500 had gained 0.4% and the tech-heavy Nasdaq 100 had risen almost 1% on Monday, with Activision Blizzard Inc. advancing after Microsoft Corp. and British regulators held “productive” talks needed to clear the companies’ $69 billion tie-up. The dollar was slightly weaker against major peers Tuesday and the offshore yuan was little changed. Concern is growing in Asia after China’s disappointing economic figures released Monday prompted economists at several major banks to downgrade outlooks. JPMorgan Chase & Co., Morgan Stanley and Citigroup Inc. cut their growth projections for this year to 5%, putting Beijing’s official gross domestic product target of the same figure at risk. In the hours after the data release, which helped push stocks in Shanghai lower on Monday, calls mounted from investors for Beijing to inject real stimulus into its flagging economy. Optimism is mounting in the US that the Federal Reserve is nearing the end of its monetary-tightening cycle as the inflation threat wanes. Treasuries steadied in Asian hours after the yields fell across the curve on Monday. As the Fed nears the endpoint for the cycle, investors will become increasingly comfortable adding duration exposure, according to BMO Capital Markets strategist Ian Lyngen. “In the very near-term, the trajectory of rates will be a sideways shuffle until the Chair’s press conference ends the hawkish versus dovish hike debate,” he wrote in a note. In the US, the next pressure point for markets will be earnings, with hundreds of companies reporting over the next few weeks. S&P 500 firms are expected to post a 9% drop in profits in the second quarter, making it the worst season since 2020, according to data compiled by Bloomberg Intelligence. In Europe, it may be even worse, with a projected 12% slump. In commodities, oil halted a two-day loss as concerns over the state of China’s economy were offset by Russia’s plans to cut crude exports. Gold edged higher.
Nikkei +0,12% Hang Seng -1,87% CSI -0,26% Shanghai -0,29% Shenzen -0,19%
Eur$ 1,1255 CNH 7,1745 CNY 7,1702 JPY 138,44 GBP 1,3098 CHF 0,8586 RUB 90,5501 TRY 26,3545 WTI$ : 74,43 Gold 1,961 BTC 30,097 ETH 1,910
S&P -0,03% Nasdaq -0,11% EuroStoxx +0,11% FTSE -0,05% Dax +0,02% SMI +0,00%
Macro :
- Tech and Property Woes Haunt Greater China Stocks: Macro Squawk
- China Disinflation to Favor Global Bonds Over Stocks: Macro View
- JPMorgan’s Kolanovic Sees ‘Modestly Wider’ Path to Soft Landing
- Citi Strategists Say Traders Are Positioning for a Soft Landing
Keep an eye on :
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- AKER NO : Aker 2Q Net Asset Value per Share NOK770 Vs. NOK803 Q/Q
- ARAMI FP : Aramis 3Q Adjusted Revenue EU489.0M Vs. EU458M Y/y
- AOF GY : Atoss Software Sees FY Sales at Least EU142M, Saw EU135M
- AZN LN : Astra, Sanofi RSV Drug Approved in US for Use in Infants
- BLK US : *BLACKROCK NAMES ARAMCO CEO AMIN NASSER TO ITS BOARD
- BRG NO : Borregaard 2Q Operating Revenue Meets Estimates
- CO FP : Casino Aims for Agreement With Kretinsky Group by End of July
- CFN PL : Cofina Says Potential Buyer of Media Unit Is Expressao Livre
- COTY US : Coty to Sell $150M of Retained Wella Stake
- DBAN GY : Deutsche Beteiligungs Sees Added Net Income From R+S Stake Sale
- GAM SW : Niel’s Newgame to Offer CHF0.55/Shr for GAM Stake: M&A Snapshot
- HPQ US : HP to Move Some PC Production to Thailand, Mexico: Nikkei
- HUSQB SS : Husqvarna 2Q Adjusted Operating Profit Beats Estimates
- KEMIRA FH : Kemira 2Q Oper Ebitda Misses Estimates
- LMT US : Lockheed Risks $400 Million Payment Delay Over New F-35 Software
- META US : Meta Faces Nasdaq Cut Even Though It Missed Rebalance Level
- MTRS SS : Munters 2Q Ebit Beats Estimates
- NEL SS : Nel 2Q Ebitda Loss NOK138M, Est. Loss NOK149.3M
- NOVN SW : Novartis 2Q Core EPS Beats Estimates
- NOVN SW : Novartis Raises FY Outlook, Announces $15 Billion Buyback
- OCDO LN : Ocado 1H Revenue Beats Estimates
- ORDI NA : Sopra Steria Launches All-Cash Public Offer for Ordina Shares
- PRX NA : Prosus CFO Basil Sgourdos Transfers Shares to Family Trust
- RL US : Ralph Lauren Will Keep Raising Prices to Boost Brand Prestige
- SEBA SS : SEB to Start New SEK 1.25b Buyback Program of Class A Shares
- SGSN SW : SGS Names Ex-Holcim CFO Géraldine Picaud as New Finance Chief
- ST5 GY : Kingspan to Buy Majority Stake in German Building Firm Steico
- SSYS US : Stratasys Intends to Engage in Talks With 3D Systems
- TSLA US : Tesla Board to Return $735 Million in Stock Awards to End Suit
- VOW GY : VW Holds BEV Lead Despite Tesla Price Cuts; EU Car Sales Up 18%