Sept 22 Asian wrap Japan continued weakness ahead of holiday, China rebounds from initial weakness.


22 Sep

This and previous notes can be found at Substack ( Asian Market Sense )
Check out ERI-C.com  for your research needs  

Europe
Markets opened higher as fears over Evergrande ease but drifting lower with concerns over energy prices and caution ahead of the FOMC decision.  No major earnings due.
Ahead
Eurozone ECM Non Monetary Meeting, Consumer Confidence Flash,
US Futures
Opened inAsian time lower Dow futures -30 points, or 0.09%. S&P 500 -0.13 and Nasdaq 100 futures -0.18%.  
At 1:30 HK time futures were Dow Jones +96 points. S&P 500 futures and Nasdaq 100 futures both in positive territory.  Improving as European trading gets underway.
Ahead 
MBA Mortgage Applications and 30 yr Mortgage Rate, EIA Oil Report, FOMC Interest Rate Decision.

CHINA
 
Market re-open CSI 300 opened down 2% but quickly bounced back to 4,820 and traded around 4,800 in the morning as Evergrande’s Onshore unit to pay bond interest on Thursday although actual amounts unknown also helped by PBOC injecting further liquidity into the market. PM seeing the market continue to rebound but with resistance at 4,830 level dipped to 4,810 but ticked up to close -34pts (-0.7%) @ 4,822
The strength of the market in the PM would suggest ‘Team China’ active supporting the market. It will be interesting to see if the support continues as more details of the Evergrande payment schedule comes out and the status of the off-shore bond payments is known.

Shanghai Composite +15pts (+0.4%) @ 3,629 T/O US$80,240 -11% DoD
Shenzhen Composite -82pts (-0.6%) @ 14,277 T/O US$92,154 -17% DoD
ChiNext Composite -17pts (-0.5%) @ 3,468

CHINA DATA
Loan Prime Rate 1 year Sept 3.85% unchanged
Loan Prime Rate 5 year Sept 4.65% unchanged

HONG KONG Market closed ADR’s were  -119pts @ 24,102 with broad weakness, only HK EX, Tencent and Meituan +VE. But re-opens Thursday

HONG KONG DATA
HK reported 1 new covid case; 
imported. Now 36 days without a local case.
Tomorrow After market Current Account

SHORT SELLING HSI Tuesday 17.1% vs 22.2% Monday
Top shorts   
Henderson Land (12) 49%, Wharf REIC (1997) 49%, Country Garden (2007) 48%, Haidilao (6862) 44%, BYD (1211) 40%, Bud Apac (1876) 38%, New World Dev (17) 35%, MTR (66) 34%, Hang Lung Ppty (101) 31%, CK Asset (1113) 31%, Hang Seng Bank (11) 30%ICBC (1398) 30%, Petrochina (857) 29%, Bank of China (3988) 27%, AIA (1299) 26%, Sunny Optical (2382) 26%, Wuxi Bio (2269) 26%, Xinyi Glass (868) 26%, SHKP (16) 25%,


Market News
Regional Markets

Australia
lower and dipped to 7,240 as expected but then as yesterday worked higher to test 7,340 around 2pm and since then has eased back to 7,234 bounced but then sold down to close +23pts (+0.3%) @ 7,297.
News of an earthquake near Melbourne failed to signifcantly undermine the market although Insurers were weak.
Sentiment helped by the news that Evergrande would pay something regarding the onshore bond payment prompting a rebound in iron ore miners helped by an upgrade from Citi. Energy stocks and Gold +VE helping to support the markets
Data
RBA warned on household debt driven by booming property prices could increase the risk of financial instability.
Leading Index Aug -0.3% vs -0.12% Jul (F/cast was -0.1%)
Tomorrow Flash PMI data
Japan
Market will be closed Thursday for Autumninal Equinox Day
No surprises from the BoJ statement but lowered outlook due to covid.
Nikkei opened lower again and sold down to 29,600 before bouncing back to flat only to then later sell down into lunch. PM opened flat but drifted lower with support at 29,620 before working better to 29,735 nit then sold down to close -200pt (-0.7%) @ 29,639. Volume remained light with volume slowing in the PM session.
Topix traded in a similar fashion closed -21pts (-1%) @ 2,044
Leaders Property, Shippers, Pharma, Miners and Other Products
Laggards Trading Cos, Wholesale, Machinery, Foods, Chemicals and Warehouses.
S Korea
Market closed re-opens tomorrow
Taiwan
Taiex re opened lower and dropped to 16,900 in early trades and then traded sideways around that level. Good local data largely ignored. Closed -351pts (-2%) @ 16,926   T/O remained light @ US$10.57bn) Good local company data largely ignored. 
CECC reported 7 new covid cases
(6 imported)
Palau President Surangel Whipps Jr. on Tuesday urged the United Nations to allow Taiwan to participate in its system on the first day of the General Debate of the U.N. General Assembly's 76th session in New York.
Taiwan's government recently announced that it will soon amend existing laws governing cross-strait exchanges to impose a maximum three-year sentence and a maximum possible fine of NT$15 million (US$540,005) on Taiwanese proxies of Chinese companies who facilitate Chinese investment in Taiwan without government permission.
After Market
Unemployment Rate Aug 4.08% vs 4.36% Jul (F/cast was 3.9%)
Tomorrow after market Interest Rate Decision, Retail Sales and M2 Money Supply

No HK/CHINA Connect Flows


Comments
* The email will not be published on the website.