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Asia muted open BoJ in focus, TSMC weak ADR’s -VE for the chipstocks and Fast Retail trimming f/cast -VE for retail; although I think worth accummulating both on weakness. US advisery on HK due another -VE today.
Australia Futures indicate -6pts, sentiment -VE as Melbourne goes into lockdown #5, oil weak but gold +VE
Japan Nikkei futures -37pts expect a cautious open ahead of the BoJ announcement and with the rise in covid cases and the weekend. Retail weak after Fast Retail trimmed its forecast
S Korea Expect markets to open lower with Samsung under pressure after the TSMC numbers and the high number of covid cases.
Taiwan Market to open flat, TSMC ADR’s were weak but Istill like the name and would accummulate on weakness. Old economy likely to see interest.
China Expect market to open lower with concerns about the brekdown in the relationship with the US adding to concerns over debt defaults and the slowing economy.
HK ADR’s -108pts at 27,888 broad weakness concerns about slowing Japan and deteriorating relations with the US
Europe Eurozone inflation data, results and covid the key drivers.
Opened Dow -32pts S&P -0.1%, NDX -0.1% weak going into the weekend
DOW +0.15%, NDX -0.7%, S&P -0.33%, Russel 2K -0.55%
A weak open but Dow worked back to flat and then traded sideways. S&P traded sideways in red andweakened in the PM but recovered into the close. NDX drifted lower through the morning but saw an uptick in the PM. Morgan Stanley +0.2% beat top and bottom.
Banks JPMorgan Chase +0.2%, Citigroup +1.9% Wells Fargo +0.1%, Amex +0.2%
Work from home names: Facebook -0.9%, Apple %, Amazon -1.4%, Netflix -0.9%, Disney +0.4%, Zoom Video -1%, Alphabet -1% and Microsoft -0.5%,
Tech NXP Semi -4.5%, Nvidia -4.4%, Micron -2%, AMD -2.4%, Skyworks -0.6%
Re-opening stocks Boeing -0.8%, Caterpillar -0.1%, Simon Property %, Kohl’s -1.6%, Nordstrom -2.2%, Gap -4.1%, United Airlines -0.9%, Carnival -2.8%, Wynn Resorts -2.2%, Chevron -0.7%, Exxon Mobil -1%,
Lock down names Campbell Soup +1.6% General Mills +0.9%, JM Smucker +1.3%
Initial Claims 360k vs 386k prior revised (F/cast was 368k)
4 week Ave Initial Claims 382.5k vs 397k prior revised (F/cast was 394 k)
Continuing Claims 3.241m vs 3.367m prior (F/cast was 3.3m)
NY Empire State Manufacturing Index Jul 43 vs 17.4 Jun (F/cast was 18)
Import Prices Jun +11.2% YoY vs +11.6% May revised (F/cast was +11%)
Import Prices Jun +1% MoM vs +1.4% May revised (F/cast was +0.9%)
Export Prices Jun +16.8% YoY vs 17.5% May (F/cast was 17.8%)
Export Prices Jun +1.2% MoM vs +2.2% May (F/cast was +1.5%)
Philadelphia Fed Manufacturing Index Jul 21.9 vs 30.7 Jun (F/cast was 29)
Industrial Production Jun +0.4% MoM vs +0.7% May revised (F/cast was +0.6%)
Industrial Production Jun +9.8% YoY vs +16.1% May revised (F/cast was 12.2%)
Manufacturing Production Jun +9.8% YoY vs +17.9% May revised (F/cast was +10%)
Manufacturing Production Jun -0.1% MoM vs +0.9% May (F/cast was +0.4%)
Capacity Utilisation Jun 75.4% vs 75.1% May (F/cast was 75.3%)
EIA Natural Gas Stocks Changes 55Bcf vs 16 Bcf prior (Consesensus was 47 Bcf)
USD was little changed vs Yen & Euro. Bitcoin -3% @ 31,756.08, VIX +4.1% @ 17.01, US T10 @ 1.301% as Powell continues his dovish testimony.
OIL Brent -1.94%, WTI -2.24% After new OPEC deal
Gold +0.29%, Silver +0.62%, Copper +1.03% Platinum +0.92%, Palladium -3.2%.
AHEAD Retail Sales, Business Inventories, Michigan Data, Baker Hughes Rig Data, Overall Net Capital Flows, Net Long Term Tic flows, Foreign Bond Investment
DAX -1.01%, CAC -0.99%, FTSE -1.12%
A weak open and trended lower through the day as investors try to get a grip on where inflation is going. Oil and Gas weak on the new OPEC deal.
Siemens Gamesa -14.4% after issuing a second profit warning; its parent company Siemens Energy also slid over 11.1%.
Inflation Jun +2.3% YoY vs +2.5% May (F/cast was +2.3%)
Inflation Jun +0.4% MoM vs +0.3% May (F/cast was +0.4%)
Inflation Jun +1.5% YoY vs +1.4% May (F/cast was +1.5%)
Inflation Jun +0.1% MoM vs +0.3% May (F/cast was +0.2%)
EUROZONE New Car Registrations, Balance of Trade, Inflation Detail
GERMANY No data due
FRANCE No data due
UK No data due
Nikkei futures -37pts expect a cautious open ahead of the BoJ announcement and with the rise in covid cases and the weekend. Retail weak after Fast Retail trimmed its forecast
Yen currently 109.83
Data due BoJ rate decision
Tokyo reported 1,308 new covid cases Thursday hghest in 6mths -VE for sentiment
U.S. Deputy Secretary of State Wendy Sherman will visit Japan, South Korea and Mongolia next week, the State Department said, making no mention of anystop in China that had been anticipated in foreign policy circles and reported in some media.
In a joint statement released after the Japan-Australia talks, their ministers affirmed that the CPTPP and the 15-member RCEP are critical to post COVID-19 economic recovery for the region.
Fast Retailing, owner of clothing brand Uniqlo, trimmed its profit outlook for the year, saying additional government restrictions in Japan and other markets to contain fresh COVID-19 infections has slowed customer traffic in stores.
Expect markets to open lower with Samsung under pressure after the TSMC numbers and the high number of covid cases.
No data due
KDCA reported 1,615 new covid cases on Thursday down DoD
SoftBank's (9984.T) Vision Fund has invested $1.7 billion in Yanolja, the South Korean travel and leisure firm said on Thursday, as it seeks to build on rapid pandemic-induced growth in Southeast Asia, India and Africa. Yanolja, which provides cloud-based booking and other systems for hotels and travel companies, says demand for its systems has jumped as the spread of COVID-19 put companies under intense pressure to introduce contactless services and cut costs +VE.
Doctors raise concerns over Hyundai Pharm’s abortion pill, a group of local experts on Thursday called for a bridging study to verify the pill’s safety and efficacy. -VE
SK Bioscience is to soon begin the Phase 3 clinical trial of its COVID-19 vaccine candidate, the firm’s CEO Ahn Jae-yong told a local seminar held Wednesday. Ahn also added the company expects the vaccine to be out early next year. +VE
KT on Thursday announced the launch of pure end-to-end 5G service, becoming the first mobile carrier in South Korea to commercialize a 5G standalone network. +VE
BlackRock Real Assets said Thursday it has closed its first investment in South Korea’s offshore wind sector, in line with the country’s renewable energy transition initiative. The New York-based asset managing arm dedicated to real estate and infrastructure investment acquired a 100 percent equity stake in renewables developer Korea Renewable Energy Development & Operation Holdings, formerly known as Igis Private Equity. The transaction price was not disclosed.
Market to open flat, TSMC ADR’s were weak but Istill like the name and would accummulate on weakness. Old economy likely to see interest.
No data due
Two US representatives on Wednesday urged the US Department of State to be wary of Chinese meddling in Haiti following the assassination of Haitian president Jovenel Moise last week. They also highlighted the importance of Haiti’s ties to Taiwan in the letter to US Secretary of State Antony Blinken. Haiti is one of Taiwan’s 15 diplomatic allies.
TSMC signalled on Thursday plans to build new factories in the United States and Japan, riding on a pandemic-led surge in demand for chips that power smartphones, laptops and cars. It posted record quarterly sales and forecast higher revenue for the current quarter, said it will expand production capacity in China and does not rule out the possibility of a "second phase" expansion at its $12 billion factory in the U.S. state of Arizona. +VE
China Steel Corp yesterday said it would keep prices in the domestic market unchanged next month, despite surges in raw material prices, including iron ore and coking coal. Prices for iron ore and coking coal exceed US$200 per tonne, with coal having doubled its price since January, the company said in a statement.
However, considering a local COVID-19 outbreak and local downstream firms’ competitiveness, the company said it would focus on stabilizing steel prices and encouraging a steady development of the market. Slight -VE
Local life insurers’ first-year premiums (FYP) totaled NT$40.88 billion (US$1.47 billion) last month, dropping by more than half from NT$83.6 billion a year earlier and hitting their lowest in six months, data from the Life Insurance Association showed yesterday. -VE
The presale and new housing market in northern Taiwan shrank 14 percent in the second quarter from three months earlier to NT$228.55 billion (US$8.19 billion), as a local COVID-19 outbreak and unfavorable government policies weakened sentiment and pushed developers to the sidelines, the Chinese-language My Housing Monthly reported yesterday. -VE
Expect market to open lower with concerns about the brekdown in the relationship with the US adding to concerns over debt defaults and the slowing economy.
No data due
President Joe Biden and outgoing German Chancellor Angela Merkel on Thursday vowed to work together to defend against Russian aggression and stand up to anti-democratic actions by China.
U.S. Deputy Secretary of State Wendy Sherman will visit Japan, South Korea and Mongolia next week, the State Department said, making no mention of anystop in China that had been anticipated in foreign policy circles and reported in some media
The head of the World Health Organisation said on Thursday that investigations into the origins of the COVID-19 pandemic in China were being hampered by the lack of raw data on the first days of spread there and urged it to be more transparent.
ADR’s -108pts at 27,888 broad weakness concerns about slowing Japan and deteriorating relations with the US
Data due after market Business Confidence
Short Selling Thursday 20.1% vs 16.5% Wednesday
Top Shorts Hengan (1044) 59%, Bud Apac (1876) 51%, Hang Seng Bank (11) 43%, Ping An (2318) 37%, Country Garden (2007) 35%, Haidilao (68620 35%, Bank of China (3988) 33%, HSBC (5) 31%, Baba (9988) 29%, Geely Auto (175) 29%, ICBC (1398) 27%, AAC Tech (2018) 26%, Wharf Reic (1997) 25%, Sino Biopharm (1177) 25%, CK Asset (1113) 25%.
BYD COMPANY (01211.HK) (002594.SZ) announced that it has recently received a notice from the shareholder Lu Xiangyang who holds 8.36% shares of the company, stating that he pledged 1.7 million A shares of the company from 14 July 2021, and expected the pledging date till 20 July 2022 for operation demand purpose. -VE
FOSUN TOURISM (01992.HK) Profit Warning For the six months ended 30 June 2021, mainly due to the decrease in the business
volume of the resorts by approximately 64% at constant exchange rate, the business volume of the Group is expected to decrease by approximately 42% compared to that of the six months ended 30 June 2020. The loss in the first half of 2021 is expected to be RMB2 billion to RMB2.15 billion which was mainly due to the operating loss of the Group’s resort operations. -VE
LUK FOOK HOLD (00590.HK) announced that the overall same store sales growth reached 118% yearly for the first quarter (1Q) of financial year ending 31 March 2022 (FY2022). Among which, gold sales hiked 143% and fixed price jewellery sales added 94%. +VE
CHINA SOUTH AIR (01055.HK) (600029.SH) announced that in June 2021, passenger capacity (measured by available seat kilometres (ASK)) of the Group increased by 13.23% as compared with the same period last year. Compared with the same period last year, passenger traffic (measured by revenue passenger kilometres (RPK)) increased by 23.9%. +VE
CATHAY PAC AIR (00293.HK) announced that Cathay Pacific carried a total of nearly 40,700 passengers last month, an increase of 50% compared to June 2020, but a 98.7% decrease compared to the pre-pandemic level in June 2019. It’s looking forward to increasing passenger flights progressively and cautiously, said Chief Customer and Commercial Officer Ronald Lam. Contingent on the relaxation pace of travel restrictions in the world and Hong Kong, the airline forecast the passenger capacity in 4Q21 to be approximately 30% of pre-pandemic level. As to cargo business, the company is more cautiously optimistic as it viewed the overall cargo demand will continue to thrive till the end of the year. Slight +VE
Beyond Meat (BYND.O) said on Thursday it has launched an online store in China on JD.com's (9618.HK) ecommerce platform, as the plant-based meatmaker aims to boost sales in the world's biggest meat market where consumer interest in meat alternatives is low. +VE
China's MMG Ltd (1208.HK) has halted land clearing measures in a wilderness area on Australia's southern island Tasmania after legal action by protesters concerned about the environment, both sides said on Thursday -VE.
Secretary for Transport and Housing Frank Chan expressed that residential properties in Hong Kong continue to see tight supply with the overall home prices remaining at an unaffordable level for ordinary citizens. Chan added that, therefore, the government believes Hong Kong is not yet ready for removing the management measures for residential property demand and that the government will take timely and appropriate measures to respond to any changes in the market.
The Hong Kong Monetary Authority (HKMA) together with the Banking Sector SME Lending Coordination Mechanism today (July 15) announced a further 90-day repayment deferment for trade facilities under the Pre-approved Principal Payment Holiday Scheme.
FAW Group and ZTE (00763.HK) signed an agreement in Changchun to deepen their strategic cooperation in five key business areas, namely automotive electronics, 5G industry, product service, digitization and brand building, reported Chinese media. Both sides aim to expedite the R&D and commercialization process of new 5G applications and put on a demonstration for 5G industrial applications.
MEITUAN-W (03690.HK)'s Meituan Dache says it is recruiting drivers across 37 cities including Beijing, Shanghai, Chengdu, Guangzhou, Hangzhou, Huizhou, Shenzhen, Nanjing and Chongqing. The ride-hailing business pledges to provide new drivers with benefits like a seven-day commission-free period.SOLARGIGA (00757.HK) announced that for the period from 1 January to 30 June, the group has recorded revenue of RMB2.912 billion, up over 12% YoY.
SA SA INT'L (00178.HK) announced that for the first quarter ended 30 June 2021, the Group’s retail and wholesale turnover increased by 42.1% year on year to HK$839 million. The Group will also continue to rationalise its store network in the Hong Kong SAR to reduce its overall cost and optimise its cost structure, aiming at a faster turnaround for the Group and enhancing its profitability in the long term.EVERGRANDE (03333.HK) announced that a meeting of the Board will be held on 27 July, to discuss the special dividend plan of the Company.
MCC (01618.HK) (601618.SH) announced that the value of newly signed contracts of the company amounted to RMB615.06 billion from January to June in 2021, representing an increase of 32.2% from the same period of last year.
BABA-SW (09988.HK)'s Alibaba Cloud announced on Weibo that it had nailed a Memorandum of Cooperation with SAIC Audi for alliance in internet of vehicles, global marketing, digital ecology, smart logistics construction and more. Leveraging their respective advantages, both parties will promote digitalized marketing of auto industry and build a smart travel ecosphere through cloud computing, internet of things and data intelligence.