Focus tomorrow on AU Q2 CPI and JP BoJ decision with FOMC tomorrow night
|Asia market update: Markets in wait-mode for Wed-Fri data; Focus tomorrow on AU Q2 CPI & JP BOJ decision with FOMC tomorrow night.
General trend
- Asian markets were in cautionary mode during relatively light trading with all major indices recording losses ahead of large data releases later in the week.
- Big data releases from Wednesday onward include AU CPI; The BOJ, Fed and BOE rate decisions; US July ISM Mfg PMI: US July NFP’s; Also US tech ‘Magnificent 7’ Q2 earnings due from Microsoft, Meta, Apple & Amazon.
- Japan recorded its lowest jobless rate since January.
- USD/JPY 1-day implied volatility rose above 25.9 ahead of tomorrow’s BOJ rate decision, followed by the Fed FOMC tomorrow night.
- China 30-year Bond FUTS again hit record high; 10yr yields down to 2.13%.
- Fall out from disputed election in Venezuela (officially won by incumbent Maduro) continues to build, with widespread protests and a promise by Pres Maduro to crack down on protestors. Peru orders its diplomats to leave the country.
- US equity FUTs -0.1% to -0.2% during Asian trading.
Looking ahead (Asian time zone)
- Tue 30th (Tue eve EU, DE, FR, IT prelim Q2 GDP, Tue night DE July CPI, US Jun JOLTS).
- Wed 31st AU Q2 CPI, CN NBS Mfg PMI, JP Jun Ind Prod + Retail Sales, JP BOJ rates/bond purchase decisions (Wed eve EU July flash CPI, Wed night US Fed rate decision + Presser).
- Thu 1st AU Balance of Trade, CN Caixin Mgf PMI, (Thu eve BOE rate decision, Thu night US ISM July Mfg PMI).
- Fri 2nd KR July CPI, AU Q2 PPI, (Fri night US July NFP).
Holidays in Asia this week
- Mon July 29th Thailand.
Headlines/economic data
Australia/New Zealand
- ASX 200 opens -0.2% at 7,971.
- Australia Jun Building Approvals M/M: -6.5% v -2.3%e.
- Australia ANZ Roy Morgan Weekly Consumer Confidence Index: 83.1 v 84.4 prior (update).
China/Hong Kong
- Hang Seng opens -0.3% at 17,194; Shanghai Composite opens -0.2% at 2,885.
- China PBOC official said China should maintain positive real rates – PBOC-backed Financial News.
- China Customs Official Lyu Daliang: China's external trading environment is increasingly uncertain - financial press, at briefing.
- China Jun Smartphone Shipments Y/Y: +14.3% v +16.5% prior - CAICT [overnight update].
- Citigroup cuts China 2024 GDP growth forecast from 5.0% to 4.8% overnight update].
- China PBOC sets Yuan reference rate: 7.1364 v 7.1316 prior (weakest since Nov 21st, 2023).
- China PBOC Open Market Operation (OMO): Sells CNY216B in 7-day reverse repos; Net drains CNY51B v net injects CNY243B prior.
Japan
- Nikkei 225 opens -0.6% at 38,241.
- Japan Jun jobless rate: 2.5% V 2.6%E [lowest since Jan].
- Japan Chief Cabinet Sec Hayashi: Reiterates specifics of monetary policy are up to the BOJ to decide.
- Japan Fin Min Suzuki: Vital to address wage growth, child policy and defense strategy [overnight update].
- Japan Economic Council says Govt, BOJ should be mindful of weak Yen currency when guiding policy (inline) - Japanese press [overnight update].
South Korea
- Kospi opens -0.8% at 2,744.
- South Korea Jun Retail Sales Y/Y: 11.1% v 8.8% prior.
Other Asia
- Taiwan financial regulator to allow listing of new ETF products by end-2024 - Taiwan press.
- Taiwan Jun Monitoring Leading Indicator: 38 v 36 prior [overnight update].
North America
- (VE) Violent protests erupt in Caracas after Maduro claims election victory.
- (US) July Dallas Fed Manufacturing activity: -17.5 V -14.2E.
- (US) House Speaker Johnson: Biden's Supreme Court reforms are DOA.
- Former Pres Trump confirmed plan to create a strategic national Bitcoin stockpile if elected.
- (US) FBI Deputy Director: motive is still not clear regarding attempted assassination attempt of former President Trump.
- *(US) Treasury quarterly financing estimates: To borrow $740B in July-Sep quarter v $760BE and $847B prior estimate; Oct-Dec to borrow $565B V $670BE.
Europe
- (UK) July BRC Shop Price Index Y/Y: 0.2% v 0.0%e (prior 0.2%).
- (IL) Israeli PM Netanyahu: Hezbollah launched rocket with Iranian backing; Pledge harsh retaliation for Golan attack.
- (UK) Jun net consumer credit: £1.2B V £1.3BE; net lending: £2.7B V £1.1BE.
- (UK) Chancellor of the Exchequer (Fin Min) Reeves: Total pressures on the budgets are an additional £35B with a £22B short fall in 2024; If left unaddressed this would result in a 25% budget increase in deficit in 2024; Plans to cut spending projects worth a total of £5.5B in 2024/2025.
Levels as of 01:20 ET
- Nikkei 225 -0.2; ASX 200 -0.6%; Hang Seng -1.1%; Shanghai Composite -0.6%; Kospi -1.2%.
- Equity S&P500 FUTs -0.1%; Nasdaq100 FUTs -0.2%, Dax -0.2%; FTSE100 -0.2%.
- EUR 1.0814-1.0825: JPY 153.62-154.60; AUD 0.6533-0.6558; NZD 0.5864-0.5894.
- Gold +0.3% at $2,431/oz; Crude Oil +-0.4% at $75.48/brl; Copper -0.9% at $4.0572/lb.
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